On July 2, US spot Bitcoin (BTC) exchange-traded funds (ETFs) witnessed net inflows of $221.72 million, marking the first positive inflow day since June 12, according to SoSoValue's recent data. This shift comes as Glassnode’s latest report indicates that Bitcoin is currently in a consolidation phase, with diminished selling pressure following weeks of intense institutional redemptions.
Respite from Outflows
The July 2 data signaled an end to a taxing ten-day outflow streak, during which the funds experienced a considerable drain since mid-June. Following this reversal, total net assets sat at $74.37 billion, a drop from over $100 billion at the start of May.
Market Reactions and Price Performance
The cessation of redemptions has been a relief after an arduous period, as spot Bitcoin ETFs lost nearly $9 billion over two months, reflecting the most significant institutional retreat since the products launched in January 2024. On the same day, Bitcoin's price fluctuated dramatically, dipping below $62,000 after Strategy, a major corporate Bitcoin holder, announced a sale. However, it quickly rebounded over $2,300 within three hours, trading around $63,643 during the reporting period.
This swift recovery follows a previous rise toward $62,000 from a low of approximately $58,200 on June 25. Notably, this low represents around 54% below the record high of $126,080 reached on October 6, 2025. The recent decline is still less severe compared to the 77% to 84% pullbacks that concluded the 2018 and 2022 market cycles.
Indicators of Market Stabilization
In its Market Pulse report for week 28, Glassnode pointed out signs of stabilization within the market, suggesting a transition away from aggressive selling towards a more balanced state. The firm noted, 'The Bitcoin market is currently exhibiting signs of structural stabilization, characterized by a transition from aggressive distribution toward a state of equilibrium.'
Supporting evidence can be found in derivatives data, which indicates rising futures open interest and long-side funding payments surpassing historical averages, signaling a renewed bullish sentiment. Moreover, moderation in the 25-delta options skew suggests that the demand for downside protection is lessening. On-chain metrics further reflect this sentiment; both active addresses and transfer volumes are on the upswing, and the average ETF investor has returned to profit. Still, long-term holders are remaining steadfast even amid unrealized losses.
However, Glassnode warns of a growing segment of hot capital, which refers to short-term, price-sensitive funds that often precede market volatility. The recent price fluctuations following Strategy's announcement exemplify this trend, as volatility has increased even amid the ongoing recovery.
