U.S.-listed spot Bitcoin (BTC-USD) exchange-traded funds recorded a second consecutive week of net inflows, suggesting that investor sentiment toward cryptocurrencies may be starting to stabilize after nearly two months of capital outflows. The 13 spot Bitcoin ETFs attracted $75.7 million last week after securing $197.4 million in the previous week, despite investors withdrawing $424.7 million last Monday following renewed military conflict between the U.S. and Iran. Richard Galvin, executive chairman of crypto investment firm DACM, said the reversal after eight straight weeks of outflows could indicate that Bitcoin and the broader cryptocurrency market are beginning to find a bottom. Galvin noted that the size and reach of the ETFs make their fund flows a useful measure of general investor sentiment toward Bitcoin and the wider sector.
Bitcoin has moved back above its 200-week moving average of roughly $63,300, a level viewed as an important dividing line between an extended bearish or bullish market. The cryptocurrency briefly climbed above $65,000 during Asian trading following fresh U.S. strikes on Iran, although it has remained largely confined to a range of $60,000 to $65,000 amid broader macroeconomic uncertainty. Damien Loh, chief investment officer at Ericsenz Capital, said the conflict could increase inflation and interest-rate risks, potentially delaying a broader return of institutional capital to Bitcoin and other risk assets. Loh added that passage of the Clarity Act, a long-awaited U.S. market-structure bill, before Congress's August recess could provide a potential catalyst for Bitcoin to move higher.
The improving ETF flows come as Strategy Inc., a company positioned by founder Michael Saylor as a major corporate Bitcoin accumulator, appears to be placing greater emphasis on liquidity. Bitcoin has declined roughly 10% since the beginning of June, when Strategy disclosed that it had sold a small portion of its holdings for the first time since 2022, and the cryptocurrency is now trading at around half its October high of $126,000. Strategy sold $263.5 million of common stock during the week through July 19 without purchasing additional Bitcoin, instead increasing its dollar reserve to $3.23 billion. The company also disclosed on July 6 that it had sold another $216 million of Bitcoin as meeting its dividend obligations became more difficult, suggesting that investors may need to balance signs of returning ETF demand against Strategy's more defensive liquidity position and continuing geopolitical and interest-rate risks.