What's Next for Bitcoin ETFs?
What's Next for Bitcoin ETFs? Analyst Weighs In
Bitcoin exchange-traded funds (ETFs) have shown momentum in the past month, but can they sustain it? Alexandre Schmidt, a research analyst at CoinShares, weighs in on the future of Bitcoin ETFs.
Current Market Trends
After several weeks of outflows, crypto ETFs saw some healthy inflows month-to-date, with $1.4 billion in inflows in the past four weeks, according to data from DefiLlama. Schmidt notes that "all these factors point to ETFs being well and alive — whether we will see elevated levels of activity remains to be seen, but in my view the outlook does look promising."
Impact of Geopolitical Events
Middle East Conflict
The wildcard is the Middle East conflict, which could have a broad effect on assets like Bitcoin. If fighting between Iran, Israel, and the US becomes protracted, the macro repercussions could last far longer than the immediate geopolitical shock. Schmidt notes that "the immediate impact I can think of is higher inflation triggered by higher oil prices, which in turn could reduce the chances of rate cuts during 2026."
Bitcoin ETF Demand
Despite showing signs of "absurd strength" at times, Bitcoin ETF demand has proven fragile. Heavy selling hit the sector in November 2025, and flows turned choppy toward year-end. However, Schmidt acknowledges that the conflict in the Middle East could increase Bitcoin's utility as people in affected regions use it to move currency out of Iran and other impacted areas.
Key Takeaways
- Bitcoin ETFs have shown momentum in the past month, with $1.4 billion in inflows.
- The Middle East conflict is a wildcard that could impact Bitcoin ETF demand.
- Higher inflation and interest rates could reduce the chances of rate cuts during 2026.
- Japan is a key market to watch, with a strong push to regulate crypto and launch ETFs.
Frequently Asked Questions
Will Bitcoin ETFs continue to grow?
According to Schmidt, the outlook for Bitcoin ETFs looks promising, but it's uncertain whether we will see elevated levels of activity.
How will the Middle East conflict impact Bitcoin?
The conflict could increase Bitcoin's utility as people in affected regions use it to move currency out of Iran and other impacted areas, but it could also lead to higher inflation and interest rates, reducing demand for Bitcoin ETFs.
