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Spot Bitcoin exchange-traded funds in the U.S. saw a sharp rise in outflows on Feb. 12 amid expectations of a more hawkish Federal Reserve stance on interest rate cuts.

According to SoSoValue data, the 12 spot Bitcoin ETFs recorded $251.03 million in outflows—a 342% jump from the $56.76 million seen the previous day.

Fidelity’s FBTC led outflows for the third consecutive day with $101.97 million exiting the fund, followed by ARK and 21Shares’ ARKB with $97.03 million. Additional outflows included:

• Bitwise’s BITB: $25.94 million
• BlackRock’s IBIT: $22.11 million
• Invesco Galaxy’s BTCO: $9.69 million
• Grayscale’s GBTC: $6.92 million
• Valkyrie’s BRRR: $3.71 million

Grayscale’s mini Bitcoin Trust was an exception, recording $16.34 million in inflows. The remaining three BTC ETFs saw no net movement.

Total trading volume for Bitcoin ETFs reached $2.53 billion on Feb. 12, with cumulative net inflows standing at $40.21 billion.

Ether ETFs also switch to net outflows

Bitcoin ETFs weren’t alone in experiencing outflows—nine Ether ETFs also turned negative.

ETH ETFs recorded $40.95 million in redemptions, reversing the previous day’s $12.58 million in inflows. The losses came entirely from Grayscale’s ETHE and Fidelity’s FETH funds which saw $30.23 million and $10.72 million in outflows. Daily trading volume stood at $349.41 million, with total net inflows since launch at $3.13 billion.

Market reaction to inflation data

Bitcoin and Ethereum ETF outflows coincided with a decline in Bitcoin (BTC) and (ETH) prices following stronger-than-expected U.S. inflation data. January’s inflation came in at 3.3% year-over-year, exceeding the 3.1% forecast.

With inflation running hotter than expected, traders now anticipate only one rate cut in 2025, with the Fed likely holding steady until 2026. As a result, the crypto market suffered, as digital assets generally perform better in lower interest-rate environments.

Commenting on the impact of the latest inflation data, David Hernandez, crypto investment specialist at 21Shares, told crypto.news that it weighed on both BTC prices and S&P 500 futures. However, he noted that this reaction could set the stage for a major rally if the Fed cuts rates later this year.

“Any rate cut that does materialize could unleash a flood of liquidity, propelling equities and crypto higher,” he explained.

Hernandez added that Bitcoin, in particular, could benefit significantly, potentially surging to new all-time highs. “BTC could break through $110,000 and solidify its place in six-digit territory,” he said.