Bitcoin ETFs: $507M Inflow Breaks Five-Week Outflow Trend

The flow reversal is decisive. On February 25, Bitcoin spot ETFs recorded a net inflow of $507 million, marking the largest daily total since early February. This single-day surge breaks a prolonged five-week streak of net outflows that had drained $3.8 billion from the funds.

Leadership is clear. BlackRock's IBIT was the primary driver, attracting $297 million in new capital. Grayscale's GBTC followed with $102 million. Together, these two funds accounted for over 79% of the day's total inflow, signaling concentrated institutional buying.

The immediate impact is a reset in the asset base. Total ETF net assets now stand at $87.6 billion, representing 6.34% of Bitcoin's market capitalization. This inflow not only halts the outflow trend but also begins to rebuild the $54.57 billion in cumulative net inflows since inception.

Price Action: A Direct Flow-Driven Rebound

The price recovery is a direct mirror of the flow reversal. Bitcoin climbed to $68,230 yesterday, posting a 6.2% daily gain and reclaiming the $68K psychological level. This move followed a sharp drop to a 24-hour low of $64,758, suggesting the ETF inflows provided a clear floor and momentum.

The technical structure confirms a shift. By bouncing from that $64.7K bottom-a-level-notably higher than previous swing lows-Bitcoin established a "Higher Low" structure. This bullish signal, combined with the spot ETF inflows, appears to have concluded a short-term corrective phase and set the stage for a retest of higher resistance.

The rally is broad-based. The entire crypto market cap rose about 6% to $2.42 trillion, with Ethereum leading the charge by jumping over 10%. This coordinated move underscores how institutional capital flowing into Bitcoin ETFs is lifting the entire sector.

Sentiment and Sustainability: Gauging the Flow Pressure

Market sentiment remains fragile, with the Crypto Fear and Greed Index ticking up to 11 from 8. This slight easing points to a minor reduction in fear, but the index is still deep in "extreme fear" territory. The move suggests the recent ETF inflows have provided some psychological relief, yet widespread caution persists among traders.

On-chain stress indicators reveal deeper pressure. Bitcoin's Realized Profit/Loss Ratio has fallen below 1, signaling a shift into an excess loss-realization regime. Historically, breaks below this level have persisted for six months or more before a constructive return of liquidity. This condition reflects that a large portion of the Bitcoin supply is still underwater, creating a latent overhang that could cap rallies.

The durability of the current flow trend now appears sustainable. After five weeks of net outflows totaling $3.8 billion, weekly ETF flows have turned positive at $560.4 million. This rebound in weekly inflows, following a single-day surge, indicates the buying momentum is broadening beyond a one-off event. For the flow-driven price recovery to continue, this sustained weekly inflow must persist.