Christmas market hype fizzles out! Bitcoin and Ethereum ETFs lose momentum, analysts: next year's trend depends on post-holiday performance

Christmas and New Year holidays are approaching, and the cryptocurrency market seems to have already entered a “hibernation mode.” US Bitcoin and Ethereum spot ETFs collectively lost value on Tuesday, mainly due to year-end asset rebalancing and liquidity tightening before the long holiday, with profit-taking selling pressure clearly increasing. According to SoSoValue data, the US Bitcoin spot ETF experienced a net outflow of $188.6 million on Tuesday, marking the fourth consecutive day of withdrawals. Among them, BlackRock’s IBIT suffered the heaviest outflow, with a single-day net outflow of $157.3 million; Fidelity’s FBTC and Grayscale’s GBTC also failed to escape. On the other hand, Ethereum spot ETFs also recorded a net outflow of $95.5 million on Tuesday, contrasting sharply with the previous day’s net inflow of $84.6 million. Notably, Grayscale’s ETHE had a single-day outflow of $50.9 million, the largest among all Ethereum ETFs on that day. Kronos Research Chief Investment Officer Vincent Liu analyzed that the outflow of Bitcoin and Ethereum ETF funds mainly reflects the year-end market mechanism rather than a loss of investor confidence. Insufficient liquidity, portfolio rebalancing, and profit-taking are the main factors causing market weakness. Nick Ruck, head of LVRG Research, also expressed similar views. He added that, besides seasonal profit-taking and declining liquidity, tax-loss selling (selling losing positions to offset taxes) is another reason for recent capital outflows. Presto Research researcher Rick Maeda warned that market reactions to ETF fund changes before Christmas should not be over-interpreted. He pointed out that in recent months, Bitcoin and Ethereum ETF fund flows have been volatile, and year-end risk reduction and book adjustments are normal phenomena, especially after increased volatility in Q4. Comparing with last year’s data, Maeda noted that in the four trading days before Christmas 2024, Bitcoin spot ETFs experienced over $1.5 billion in net outflows, when prices were retreating from all-time highs. In contrast, he considers this year’s fund withdrawal to be relatively moderate. According to CoinGecko data, Bitcoin is trading at $86,755 at the time of writing, down 0.7% in the past 24 hours; Ethereum has fallen 2.3% to $2,918. However, not all crypto ETFs experienced selling pressure. Ripple (XRP) spot ETF still saw an inflow of $8.2 million on Tuesday; Solana (SOL) spot ETF also recorded a net inflow of $4.2 million. Contrary to the trend in the crypto market, the US stock market closed higher across the board on Tuesday. The S&P 500 rose 0.46%, closing at 6,909.79 points, reaching a new all-time high; the Nasdaq increased by 0.57%, and the Dow Jones Industrial Average also rose slightly by 0.16%. The US stock market closed early on December 24 and was closed on December 25 for Christmas. Market consensus believes that the market response after the long holiday and economic indicators are the real key, as they will serve as important clues for observing the market trend in early 2026.