Bitcoin ETFs Selling Eases While Bond Yields Signal New Risk

TLDR

• U.S. spot Bitcoin ETF products recorded $228 million in net outflows during the shortened trading week.
• Bitcoin ETF withdrawals slowed for a second consecutive week after six weeks of net redemptions.
• Total cumulative Bitcoin ETF outflows reached $5.94 billion, according to SoSoValue data.
• Tagus Capital said institutional de-risking appears to be easing as investors adopt more selective positioning.
• The U.S. two-year Treasury yield climbed to 4.21%, its highest level since February 2025.

Bitcoin traded higher at the start of the week as easing tensions between the United States and Iran supported risk assets. However, Bitcoin ETF outflows continued, while Treasury yields pointed to growing expectations for tighter monetary policy.

Bitcoin ETF Outflows Slow but Remain in Negative Territory

U.S. spot Bitcoin ETF products recorded $228 million in net withdrawals during the shortened trading week. Although funds continued to lose capital, the pace of redemptions eased for a second consecutive week.

The latest figure followed $315.84 million in outflows during the previous week. Data from SoSoValue showed cumulative withdrawals reached $5.94 billion after six straight weeks of net redemptions.

Earlier weeks produced heavier selling pressure as withdrawals exceeded $1 billion each week. However, recent figures showed a slower rate of capital leaving Bitcoin ETF products.

Tagus Capital said the sharp phase of institutional selling appears to be fading. The firm said investors have started adopting a more selective approach to portfolio positioning.

“While the market has not yet returned to sustained net inflows, the slowdown indicates that the most aggressive phase of institutional de-risking is fading,” Tagus Capital said.

The firm added that fund flows now appear more balanced than during earlier weeks. As a result, ETF demand showed signs of stabilization despite continued withdrawals.

Treasury Yields Rise as Oil Prices Retreat

Another market trend emerged through the relationship between Treasury yields and crude oil prices. While oil futures moved lower, the U.S. two-year Treasury yield continued climbing.

The two-year yield traded near 4.21%, reaching its highest level since February 2025. That movement contrasted with declining oil prices following hopes for reduced geopolitical tensions.

Market participants appeared to shift attention from energy prices toward interest-rate expectations. As a result, bond markets reflected concerns about persistent inflation pressures.

Traders have focused on the potential effects of the March oil-price increase. Some analysts expect those earlier gains to keep inflation elevated in the coming months.

The Federal Reserve’s preferred inflation measure could provide fresh guidance this week. According to FactSet forecasts, core PCE likely increased 0.37% during the month.

If confirmed, the annual core PCE rate would rise to 3.4%. That reading would mark the highest level recorded since May 2024.

Higher inflation readings often influence expectations for future Federal Reserve policy. Consequently, Treasury yields have remained firm despite weakness in energy markets.

Bitcoin Faces Multiple Near-Term Market Pressures

Bitcoin gained support from improved risk sentiment linked to expectations of a U.S.-Iran deal. Even so, ETF withdrawals and rising yields continued shaping market conditions.

Tagus Capital said the slower pace of ETF outflows may help reduce downside pressure. The firm stated that investors are repositioning capital rather than accelerating exits.

“Overall, this points to a stabilizing but still fragile ETF demand backdrop,” the firm said. It added that investors are gradually reallocating funds rather than increasing withdrawals.

Markets are also tracking developments involving Strategy and its STRC preferred stock. Any action by the company could influence sentiment because it remains the largest publicly listed Bitcoin holder.

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