ETF Investors Flee Bitcoin & Ethereum - But Altcoin Funds Defy the Exodus

Big money's playing musical chairs, and the old favorites just got left standing.

The Great Rotation Begins

Exchange-traded fund flows are telling a stark story. Capital is draining from the crypto establishment—Bitcoin and Ethereum are seeing net outflows as institutional portfolios get a shake-up. The safe-haven narrative? Taking a breather.

Altcoins Steal the Spotlight

While the giants bleed, capital is finding its way into a more speculative corner of the market. Dedicated altcoin funds are bucking the broader trend, posting inflows. It's a classic risk-on pivot within digital assets—investors aren't leaving the casino, they're just moving to a different table with higher-stakes games.

The New Diversification Play

This isn't just random speculation. The move signals a maturation in strategy. Portfolio managers are no longer just buying 'crypto'—they're actively allocating across the ecosystem, seeking alpha beyond the two market cap leaders. It's tactical positioning, betting on the next narrative cycle before it hits the mainstream financial press.

The smart money is doing what it always does: front-running the next story while the herd rebalances last quarter's playbook. After all, what's finance without a little fashionable contrarianism dressed up as strategic insight?

Bitcoin and Ether ETFs See $750M Outflows Despite Strong Week Start

Data from SoSoValue shows spot Bitcoin and Ether ETFs recorded combined net outflows of $749.6 million between January 6 and January 9.

Bitcoin funds accounted for the bulk of the decline, shedding $681 million after four straight days of redemptions.

The slide came despite a strong start to the week, when Bitcoin ETFs attracted nearly $700 million in inflows on January 5, the only positive session during the period.

Selling pressure intensified midweek. Outflows on January 7 alone reached $486.1 million, marking the largest single-day drawdown of the week.

BlackRock’s IBIT, the largest spot Bitcoin ETF by assets, saw $252 million exit on January 9.

Bitwise’s BITB posted smaller losses, while Fidelity’s FBTC stood out as an exception, recording modest inflows on the same day.

GM

CryptoQuant reports that the $79,000 level is an important support area for Bitcoin.

This level coincides with the average purchase price (realized price) of investors in American Bitcoin ETFs.

If the price of BTC reaches $79,000, most of the ETF holders will be at the… pic.twitter.com/N80IiO4U1H

Despite the pullback, spot Bitcoin ETFs remain a major force in the market. The 12 approved funds now hold roughly $116.9 billion in net assets, equivalent to about 6.5% of Bitcoin’s total market capitalization.

Since their launch in January 2024, cumulative net inflows still exceed $56 billion.

Spot Ether ETFs followed a similar pattern, though on a smaller scale. The group ended the week with $68.6 million in net outflows after strong inflows earlier in the period were reversed by heavy selling over the final three trading days.

BlackRock’s ETHA led outflows, followed by Grayscale’s ETHE. The nine Ether ETFs currently manage $18.7 billion in assets, representing just over 5% of Ether’s market value.

XRP ETFs Buck Market Pullback With Record Volume and Fresh Inflows

While investors trimmed exposure to the two largest cryptocurrencies, appetite for altcoin-linked ETFs showed signs of growth.

Spot XRP ETFsrecorded $38.1 million in net inflows during the week and reached their highest weekly trading volume since launch at $219 million.

The surge points to rising institutional engagement as the products gain traction following their debut in late 2025.

Canary Capital’s XRPC remains the largest XRP fund by assets, followed closely by offerings from Bitwise and Franklin Templeton.

Collectively, XRP ETFs have accumulated more than $1.2 billion in net inflows, with total assets approaching $1.5 billion.

Solana ETFs also attracted fresh capital, taking in $41.1 million over the same period.

Bitwise’s BSOL continues to dominate the category, holding a commanding lead over rival products as investors selectively rotate into alternative crypto exposures.