US Bitcoin Spot ETF Sees $697.2 Million Inflows as Crypto Market Gains Momentum in Early 2026

US spot Bitcoin and Ethereum exchange-traded funds (ETFs) recorded significant inflows on the first trading day of 2026. The total inflow reached $645.8 million, with $471.3 million going to Bitcoin ETFs and $174.5 million to Ethereum ETFs according to market data. This marked one of the strongest inflow days for the sector since mid-2025.

BlackRock’s iShares Bitcoin Trust (IBIT) led the inflow with $287 million in new capital. Fidelity’s Wise Origin Bitcoin Fund (FBTC) followed with $88 million, while Bitwise’s BITB added $41.5 million according to crypto reports.

The surge reflects a shift after a period of outflows and tax-loss harvesting in late December. Institutional investors appear to be reallocating capital as the new year begins.

Why the Move Happened

The inflows occurred amid a broader improvement in liquidity across global markets. Global dollar liquidity had bottomed in November 2025 and started rising again, according to industry analysts. This trend is seen as a positive signal for crypto markets, potentially supporting renewed demand for Bitcoin and Ethereum exposure.

Additionally, the end of December saw significant outflows from crypto ETFs, with some funds recording more than $900 million in combined outflows across two weeks. The reset at the start of 2026 provided an opportunity for investors to reallocate capital after the year-end rebalancing.

How Markets Responded

Bitcoin ETF inflows are often viewed as an indicator of institutional demand for crypto exposure. The substantial inflow into Bitcoin ETFs suggests growing confidence among institutional investors. BlackRock’s IBIT alone accounted for nearly 60% of the total Bitcoin ETF inflow on January 2, signaling strong institutional trust in the product.

The positive trend extended beyond Bitcoin. Ethereum ETFs saw $174 million in inflows, with Grayscale’s ETHE leading the charge with $53.69 million. Smaller altcoin ETFs also posted gains, including $13.59 million into XRP funds and $2.3 million into Dogecoin products according to market data.

What Analysts Are Watching

Analysts are paying close attention to whether the inflow pattern continues. If the trend persists, it could signal a broader shift in investor sentiment and capital allocation toward crypto assets.

The inflows also raise questions about the structural impact on Bitcoin and Ethereum prices. ETF issuers must purchase equivalent amounts of the underlying assets to back the new shares, which can create upward price pressure. Market observers are monitoring whether these inflows will translate into sustained price momentum or if volatility remains a factor.

The broader crypto market remains mixed. Over the past 30 days, Bitcoin and Ethereum prices fell slightly, continuing a downturn after the October price peak. However, Bitcoin has rebounded in the past 24 hours, gaining 1.03% as of January 6.

The Crypto Fear & Greed Index remains at 25, indicating extreme fear among retail investors. This contrast with the positive inflows into ETFs suggests a growing divide between institutional and retail sentiment.

Looking ahead, market participants are closely watching for regulatory developments and potential Fed policy shifts. If liquidity continues to improve and risk appetite rises, the crypto market could see further inflows.