The 12 spot Bitcoin exchange-traded products (ETFs) in the United States reversed sharply last week, recording $1.2 billion in net outflows.
According to SoSoValue data, this was their second-largest weekly setback since launching in January 2024.
The pullback snapped a two-week run of inflows that had brought in more than $5 billion, a period many read as proof of deepening institutional conviction.
Data from SoSoValue show that investors pulled capital from nearly every major issuer. BlackRock’s IBIT recorded a $276 million outflow, while Fidelity’s FBTC saw $169 million leave.
Other major issuers, such as ARK Invest’s ARKB and Bitwise’s BITB, lost $290 million and $128 million, respectively, while Grayscale’s two funds shed $321 million.
The reversal followed a volatile week for Bitcoin, which briefly dipped below $104,000 during the reporting period. Notably, this was its lowest price level since June.
Industry experts linked the drawdown to macroeconomic conditions triggered by US-China tariff wars, that shook confidence in risk assets like Bitcoin.
However, the flagship digital crypto asset has rebounded strongly above $110,000 as of press time amid recent developments in the market.
London’s countermove
While US flows turned defensive, a different story that would reshape retail access for Bitcoin was unfolding across the Atlantic.
On Oct. 20, Bitcoin exchange-traded notes (ETNs) officially began trading on the London Stock Exchange. This marks the end of the UK’s three-year retail ban on crypto investment products.
BlackRock led the debut with its iShares Bitcoin ETP, joined by other leading issuers like Bitwise.
Meanwhile, early feedback about these products has been mixed, but they have still shown promising signs.
ByteTree founder Charlie Morris said initial trading activity showed “success with platforms such as Interactive Investor, Swissquote, and Trading 212,” though some brokers like AJ Bell were slower to support access.
Still, Bradley Duke, Bitwise’s head of Europe, opined that the launch of these products would mark a “big week” for retail investors because the “direction of travel is clear for crypto.”
$600 billion inflow incoming?
With a new wave of adoption emerging across the Atlantic and renewed institutional focus on Bitcoin, Galaxy Research believes that crypto investment products could attract up to $600 billion in new inflows as traditional financial institutions broaden distribution.
According to the firm, the US advisory market represents a vast, largely untapped opportunity that would drive significant flows into BTC. It stated:
“Roughly 300,000 financial advisors manage about $30 trillion in client assets. If even a modest 2% allocation to bitcoin ETFs emerged across this channel, that would translate to roughly $600 billion in potential inflows.”
These wave of flows would would rival the entire global gold ETF market, now worth about $472 billion, and quadruple the combined $146 billion in assets under management (AUM) across US spot Bitcoin funds.
The asset management firm pointed out that recent policy moves by leading traditional financial institiutions like Morgan Stanley and Vanguard support that thesis.
Notably, Morgan Stanley recently recommended up to a 4% allocation to digital assets, while Vanguard is reportedly looking to offer select third-party crypto ETFs to its brokerage clients.
These developments are expected to drive fresh capital into the emerging industry and further drive Bitcoin’s adoption.
Galaxy Research argued that the full opening of large advisory platforms could mark a structural shift in how digital assets are integrated into mainstream finance.
Once this access is fully enabled, financial advisors will be able to include crypto directly within traditional balanced portfolios, moving the asset class from retail-driven speculation toward advisor-led portfolio construction.
It noted:
“The impact could be substantial. New inflows may follow as wealth managers begin allocating to the asset class, potentially pushing total bitcoin ETF AUM to $500 billion within a few years, assuming just a 1% average allocation across managed portfolios. Such flows would reshape market dynamics and reinforce bitcoin’s position as a mainstream, investable asset.”
Galaxy’s analysis further suggested that this transition could also bring a more mature form of liquidity.
According to the firm, advisory-driven allocations tend to follow longer holding periods and stricter compliance frameworks, reducing the short-term turnover that has defined retail crypto trading.
Over time, that discipline could enhance price stability, deepen liquidity, and align Bitcoin more closely with traditional asset classes such as equities, bonds, and gold.
