‘Institutions Dumping Again’: Charles Edwards Warns ETF Outflows Are Crushing Bitcoin Momentum

Bitcoin is struggling to regain bullish momentum as institutional investors continue pulling money from spot Bitcoin ETFs, according to Capriole Investments founder Charles Edwards, who warned that renewed selling pressure is weighing heavily on price action.

“That didn’t last long. Institutions are once again dumping on us,” Edwards wrote on X, pointing primarily to ETF outflows that accelerated after a hotter-than-expected inflation print two weeks ago. “Hard to get meaningful price improvement while this metric is in the red.”

The comments come as Bitcoin trades in a fragile range amid rising geopolitical tensions, persistent inflation fears, and weakening investor appetite for risk assets. While institutional accumulation remains historically elevated over the longer term, analysts say recent ETF outflows are creating near-term headwinds for the cryptocurrency market.

Try Our Recommended Crypto Exchanges

Sponsored

Disclosure

We sometimes use affiliate links in our content, when clicking on those we might receive a commission at no extra cost to you. By using this website you agree to our terms and conditions and privacy policy.

#1

Kraken

Opened in 2011

Promotions

Get $10 in Bitcoin when you register through a referral link from an existing member.

Coins

+81

Claim Offer

#2

Bitunix

Promotions

Receive up to $100,000 worth of exclusive gifts for newcomers upon registration.

Coins

+76

Claim Offer

#3

ChangeNow

Opened in 2017

Promotions

Unlock 1,500+ cryptocurrencies and seamless instant swaps in the all-in-one crypto super app ChangeNOW

Coins

+217

Claim Offer

Bitcoin ETF Outflows Signal Weakening Institutional Demand

Spot Bitcoin ETFs have now recorded six consecutive trading sessions of outflows, totaling approximately $1.5 billion. On Friday, May 22, alone, investors withdrew roughly $105 million from the products, extending a trend that has unsettled traders hoping for a stronger post-halving rally.

According to Edwards, ETF selling intensified immediately after the latest inflation data reignited fears that the Federal Reserve may keep interest rates higher for longer. Higher inflation and rising bond yields typically pressure non-yielding assets like Bitcoin, making traditional fixed-income products relatively more attractive to investors.

The institutional slowdown is particularly significant because ETFs have been one of the strongest drivers of Bitcoin demand since their approval. When inflows were surging earlier this year, Bitcoin rapidly climbed toward new highs as funds aggressively accumulated BTC on behalf of clients.

Now, however, the reversal in flows is dampening momentum.

Maria Agustina Patti, Financial Markets Strategist and consultant to Exness, told CCN broader macroeconomic conditions are also contributing to investor caution.

“Fresh tensions in the Middle East could negatively affect broader market sentiment and reduce appetite for risk assets,” Patti noted. “A strengthening of inflationary concerns could weigh on the market at a time when central banks are already maintaining a cautious tone.”

The analyst added that although the Federal Reserve is widely expected to keep rates unchanged for now, several other central banks could still raise interest rates later this year, creating additional pressure on speculative markets.

Long-Term Institutional Buying Still Remains Historically Strong

Despite the recent ETF selling, broader institutional accumulation metrics continue to paint a surprisingly bullish long-term picture for Bitcoin.

Data shared alongside Edwards’ analysis shows that total institutional buying currently represents roughly 0.02% of Bitcoin’s market capitalization per day. By comparison, Bitcoin’s daily supply growth rate after the halving stands near just 0.002%.

This means institutions are still absorbing Bitcoin at nearly seven times the pace of newly mined supply, creating what analysts describe as a significant supply squeeze dynamic.

The statistical intensity of institutional accumulation also remains unusually high. Total institutional buying currently carries a z-score of 3.09, while corporate treasury purchases are registering an even higher z-score of 3.97, levels considered extremely rare in market history.

Such elevated accumulation historically supports bullish price action over medium-term timeframes, particularly across seven- to 30-day windows, as available market supply becomes increasingly constrained.

Analysts argue that this divergence between short-term ETF outflows and broader institutional accumulation may reflect tactical positioning rather than a complete collapse in institutional interest.

Macro Risks Continue to Cloud Bitcoin’s Near-Term Outlook

While long-term fundamentals remain constructive, Bitcoin’s short-term direction is increasingly tied to macroeconomic developments.

Rising inflation expectations, elevated Treasury yields, and geopolitical uncertainty are all contributing to a more defensive market environment. Investors are becoming more selective with risk exposure as central banks continue emphasizing caution in their monetary policy outlooks.

Bitcoin has spent recent sessions fluctuating within a narrow range as traders weigh conflicting signals: strong long-term supply dynamics versus weakening immediate demand through ETFs.

The persistence of negative ETF flows is particularly important because these products have become a key barometer for institutional sentiment. Continued outflows could reinforce bearish momentum and limit Bitcoin’s ability to break higher in the near term.

Still, some market participants remain optimistic that the current weakness may ultimately prove temporary. If institutional accumulation continues absorbing supply at historically elevated rates, analysts believe Bitcoin could regain momentum once macro conditions stabilize and investor confidence returns.

For now, however, traders appear focused on one key question: whether institutional investors are merely pausing their Bitcoin exposure, or beginning a deeper retreat from crypto markets altogether.