Bitcoin’s price recovery in January was marked by strong institutional inflows. During their first two days of trading in 2026, the U.S. spot ETFs’ inflows hit $1.2 billion.
Bloomberg ETF analyst Eric Balchunas noted that the renewed demand translated to $150 billion per year, terming the inflows ‘lion-like.’ He added,
“Told ya’ll if they can take in $22 billion when it’s raining, imagine when the sun is shining.”
On the specified dates, on the 2nd and 5th of January, the ETFs attracted a total daily net inflow of $471 million and $697 million, respectively.
However, on the 6th of January, the ETFs saw $243 million in net outflows. This coincided with Bitcoin price stalling at $94K after the early-year bounce. But will the ETF inflows become consistent and drive a rally in BTC?
Will the inflows lift BTC higher?
It’s worth pointing out that analysts singled out late 2025 ETF outflows as tied to hedge fund unwinds. Particularly those that were aggressively hunting for the basis trade.
One of the tell-tale signs was the leverage flush on the Chicago Mercantile Exchange (CME) as the basis trade yield was halved from +10% to 5%.
According to analyst James Van Straten, however, the early 2026 inflows showed no spike in CME’s Open Interest (OI), suggesting long-term conviction rather than leveraged and zero-sum basis trade plays by hedge funds.
“BTC price continues making higher highs without OI rebuilding, indicating exposure is held unhedged and flows are directionally long, not arbitrage driven.”
It was true that CME’s OI was still down around $10 billion, compared to a high of $19 billion to $20 billion seen in 2025.
In other words, if ETF inflows become consistent, with no massive spike in leveraged bets via the CME, a constructive recovery could be possible above the $94,000 resistance.
Broader BTC demand remains weak
Even so, ETFs are just one side of the BTC demand dynamics. There are others, such as retail, BTC treasury firms, and other sophisticated individual investors. They collectively influence, also influence BTC price alongside market sentiment.
Despite the renewed institutional inflows, the overall demand for BTC remained negative, according to CryptoQuant.
A stronger, more sustainable BTC recovery could be feasible if the apparent demand shifts back to positive again.
Meanwhile, BTC’s price got rejected at the $94K-$96K roadblock (red). This has been an obstacle for bulls since late November and has remained the key hurdle to clear before surging to the $100K psychological level.
Final Thoughts
- U.S. spot ETFs saw $1.2 billion in inflows in the first two days of 2026 trading, but also recorded a $243 million in net outflows on the third day.
- Amidst the fluctuations, BTC’s overall demand has remained negative, capping a stronger price recovery.
