Bitcoin Dominance Surge Coincides with Institutional Retreat from Spot BTC and ETH ETFs

Institutional investors appear to be stepping back from the cryptocurrency market as persistent outflows plague both Bitcoin and Ethereum spot ETFs, a trend that gained momentum alongside rising Bitcoin dominance metrics. According to Glassnode’s analysis, the 30-day simple moving average of net inflows for ETH ETFs has remained deeply negative since early November, signaling a sustained disengagement phase from large institutional players.

The picture is equally bearish for Bitcoin holdings. U.S. spot BTC ETFs registered $188.6 million in outflows during their latest trading session, extending a four-consecutive-day withdrawal streak that reflects cooling institutional appetite. While BlackRock’s IBIT showed isolated inflow moments on December 18 and 22, these brief upticks failed to reverse the broader downtrend, with net flows remaining in negative territory overall.

Ethereum-focused products have not fared better. Farside Investors data reveals that Ethereum ETFs experienced $95.5 million in capital outflows on December 23 alone, despite a momentary recovery earlier that same week. This pattern of short-lived recoveries followed by renewed selling pressure suggests institutional confidence remains fragile.

The timing of these withdrawals coincides with elevated Bitcoin dominance levels, potentially indicating that institutions are reallocating capital toward outright Bitcoin positions rather than diversified cryptocurrency exposure through ETFs. The sustained negative flow trajectory—now spanning several months—underscores how institutional participation in the broader crypto market has become decidedly subdued, marking a critical period of recalibration within the institutional investment framework.