The final trading session of 2025 marked a challenging period for Bitcoin spot exchange-traded funds (ETFs), which faced a significant outflow of $348 million across all 12 funds. Bitcoin itself saw a decline, closing at $87,496, down 6% from its previous year’s closing price of $93,381. This bearish trend also impacted Ethereum ETFs, which experienced outflows of $72.06 million, with no new inflows among the nine available funds. In contrast, both Solana and XRP spot ETFs managed to garner modest gains, attracting $2.29 million and $5.58 million, respectively.
Adding to the market dynamics on that day, the Federal Reserve injected a staggering $74.6 billion liquidity into the economy through its Standing Repo Facility, marking the largest single-day usage since the onset of the COVID-19 pandemic. This action was interpreted by analysts as a routine measure for seasonal balance sheet management rather than an emergency response, but it indicated a potential shift in monetary policy flexibility as 2026 approached. Such moves could reduce near-term tightening risks and create a more favorable environment for risk assets.
Charles Schwab’s strategist, Michael Townsend, pointed toward the recent Bitcoin surge past the $90,000 mark as indicative of newfound regulatory clarity following the recent U.S. elections. He estimated that regulatory uncertainties previously suppressed Bitcoin’s potential by as much as 50%. With this backdrop, Townsend predicted gains for Bitcoin in 2026, suggesting that quantitative easing and Fed bond purchases would further support the asset’s value. He also noted an expected decline in demand for government debt alongside anticipated rate cuts, which could enhance the attractiveness of Bitcoin and other high-volatility assets.
Despite this institutional optimism, ETF flows demonstrated ongoing weaknesses, revealing a lack of retail market engagement. Data from Glassnode indicated that both Bitcoin and Ethereum ETF 30-day simple moving averages remained negative as the year closed, suggesting absent retail demand. The Fear and Greed Index for Bitcoin also indicated a shift back into “Extreme Fear” territory, with analysts noting that the asset often experiences price recoveries after reaching such oversold levels.
Looking ahead to 2026, CryptoQuant provided a detailed analysis that proposed three possible scenarios for Bitcoin’s price trajectory. The most likely scenario forecasts a “twisted range” between $80,000 and $140,000, driven by intermittent ETF flows and persistent macro uncertainties related to the forthcoming U.S. midterm elections. Another scenario, which holds medium probability, suggests a recession-driven downward trend pushing Bitcoin towards $50,000, while a low-probability “risk-on” environment could propel prices to between $120,000 and $170,000 under favorable easing conditions and solidified institutional inflows.
Timot Lamarre from Unchained contextualized Bitcoin’s underperformance in 2025 by examining shifts in capital allocation. He noted that capital seeking risks gravitated towards Bitcoin treasury companies or the AI sector, whereas capital averse to debasement flowed into precious metals. Lamarre warned of escalating U.S. debt dynamics, which limit aggressive monetary policy adjustments leading into the midterm elections. Nevertheless, he remains optimistic about Bitcoin’s potential, projecting it as a primary beneficiary of cheaper and more abundant dollars once monetary easing takes shape.
In terms of institutional adoption, 2025 was marked by significant milestones, including Vanguard reversing its long-standing prohibition on crypto trading, now allowing transactions in Bitcoin, Ethereum, XRP, and Solana ETFs. Furthermore, the Commodity Futures Trading Commission (CFTC) approved spot crypto ETFs on registered futures exchanges in early December.
Finally, early Bitcoin investor Michael Terpin cautioned against an extended bear market, drawing parallels with historical patterns following Bitcoin’s halving events in 2014, 2018, and 2022. He suggests a potential bottom around $60,000 in early fall, with a recovery likely unfolding into 2028-2029. Terpin noted a slim 20 percent chance of an extended bull cycle with new highs before a final correction but cautioned that this scenario is becoming increasingly unlikely with each passing month. He identified late 2026 as a favorable accumulation period, anticipating supply shocks stemming from the next halving event to drive future cycles.
