Bitcoin ETFs See Outflows for Fourth Consecutive Day Amid Mounting U.S. Stagflation Concerns Pressuring Crypto and Equities

Bitcoin ETFs See $196M Outflow as Stagflation Fears Mount; Ether ETFs Attract Inflows

U.S.-listed spot bitcoin (BTC) exchange-traded funds (ETFs) extended their losing streak for a fourth straight session on Tuesday, with total net outflows reaching $196 million, according to SoSoValue. The heaviest withdrawals came from Fidelity’s FBTC and BlackRock’s IBIT.

The sell-off began last Thursday, totaling $1.46 billion in cumulative outflows over four sessions—the longest such streak since April.

Investor sentiment took a hit after U.S. ISM Services PMI data pointed to stagflation risks, with signs of tariff-induced inflation, softening employment, and weak trade—conditions unfavorable to risk assets like tech stocks and cryptocurrencies.

Bitcoin dropped over 1% to $112,650 before recovering slightly to $114,000. The Nasdaq declined 0.7%, erasing Monday’s gains.

“Stagflationary mix on the ISM knocking risk here,” the founders of LondonCryptoClub noted on X. “Services employment contracting, new orders and activity barely expanding, prices rising. It’s the most toxic mix for risk if it ties the Fed’s hands on rate cuts.”

Despite rising hopes for Federal Reserve easing following weak labor data last Friday, broader market pressure persists. SOFR-linked options are now pricing in potential cuts at all three remaining FOMC meetings this year, implying a total of 75 basis points in easing by early 2025.

LondonCryptoClub expects weakening growth and labor conditions will force the Fed to begin cutting in September.

Ether ETFs Attract $73M Amid Regulatory Clarity

In contrast to bitcoin, ether (ETH) ETFs saw $73.22 million in net inflows, breaking a two-day outflow trend. The inflows appear driven by recent SEC guidance suggesting that, under certain conditions, staking and token receipt may not constitute securities offerings.

According to NovaDius Wealth Management President Nate Geraci, the clarification removes a major regulatory overhang and clears the way for SEC approval of spot ether ETFs—albeit likely without staking features.