Crypto ETF Flows Diverge: ETH Outflows Clash with XRP Milestones
The digital asset ETF landscape witnessed a significant divergence in institutional sentiment on Tuesday, December 16, 2025. As BTC struggled to hold its footing above $86,000, the broader market faced a period of deleveraging that saw professional investors rotating out of high-beta assets like ETH while simultaneously building a historic foundation in the newly regulated XRP market. This day marked one of the most pronounced “risk-off” shifts for ETH since its spot ETF launch, contrasted by an unwavering streak of accumulation for XRP that has stunned many market observers.
The ETH Exodus: Over $220 Million Exits Spot ETFs
Institutional appetite for ETH experienced a sharp cooling as the asset’s price fell more than 6% in a single day, dipping toward the $2,900 range. According to data from Farside Investors and SoSoValue, U.S. spot ETH ETFs recorded a staggering $224.9 million in net outflows on December 16. This exodus was largely driven by BlackRock’s iShares ETH Trust (ETHA), which saw approximately $139 million leave the fund, alongside significant redemptions from Grayscale’s ETH Trust (ETHE).
Analysts suggest that this trade-off is not merely a reaction to ETH’s price action, but a broader structural retreat as institutional “fragile hands” rotate into more stable or under-allocated sectors. The outflow occurred against a backdrop of massive derivatives liquidations, where over $580 million in total crypto long positions were wiped out in 24 hours. While BlackRock still maintains a massive war chest of over 3.7 million ETH, the current data highlights a period of intense volatility for the second-largest cryptocurrency. Many institutional desks are reportedly pausing their accumulation to assess the potential for further downside, particularly as technical indicators show ETH struggling to reclaim the psychologically vital $3,000 level.
XRP’s Billion-Dollar Breakthrough: A Rare Streak of Accumulation
In a stark contrast to the “bleeding” viewn in BTC and ETH funds, XRP ETFs achieved a historic capital milestone yesterday. Since their debut on November 13, 2025, U.S. spot XRP ETFs have recorded an unprecedented 30-day streak of uninterrupted net inflows. This cumulative demand pushed the total net assets held by these products past the $1.18 billion mark on December 16, with cumulative net inflows surpassing $990 million and touching the $1 billion milestone. This makes XRP the quickest crypto asset outside of the “large Two” to secure such a significant institutional foothold in the U.S. capital markets.
Market commentators note that this behavior represents “mechanical” institutional purchaseing rather than retail speculation. While the spot price of XRP has remained under pressure—trading heavy near $1.90 and struggling with tradeing from long-term “whales” who are crystallizing seven-year-old profits—the ETF market has not viewn a single day of net redemptions. Steven McClurg, CEO of Canary Capital, recently noted that XRP’s lack of a native staking yield for retail users actually makes it more attractive for institutional financial instruments that prefer pure exposure to the underlying asset. The arrival of these ETFs has effectively lifted a multi-year regulatory barrier, enabling five major asset managers to build a supply-locked buffer that could eventually trigger a supply shock if weekly inflows continue at the current pace of $200 million.
