Bitcoin ETFs turn positive with $152 million in inflows ahead of Fed rate decision, while traders stay defensive amid expected volatility: analysts

Bitcoin steadied above $92,000 on Wednesday as U.S. spot ETFs swung back to net inflows ahead of the Federal Reserve’s final policy announcement of 2025 — a decision analysts say is likely to dictate whether the latest rebound has legs.

Data from SoSoValue shows U.S. spot Bitcoin ETFs recorded about $152 million in net inflows on Tuesday, led by Fidelity’s FBTC with $199 million, reversing several days of weakness. Ethereum products also added $178 million in total, with Fidelity’s fund again leading with $51.5 million. Solana ETFs drew $16.5 million, including a $7.8 million inflow into Bitwise’s BSOL.

The renewed demand coincided with a sharp but brief move higher on Dec. 9. As The Block reported, bitcoin pushed to $95,000 before sliding back into the $92,000 to $93,000 range. Ether rose 6% to $3,300, outpacing majors as whales and “shark” wallets accumulated nearly 934,000 ETH over the past three weeks, according to BRN Head of Research Timothy Misir.

ETF flows revive as leverage resets and whales accumulate

In a Dec. 10 note shared with The Block, Misir said Tuesday’s flows “rekindled risk appetite,” noting that the bounce appeared “demand-driven rather than purely a squeeze,” with spot volume rising alongside ETF inflows.

He added that bitcoin’s intraday fade showed a mix of profit-taking and returning buyers, a structure he described as “a reset, not a breakout.” Additionally, onchain conditions have continued to tilt constructively in recent days. The BRN analyst stated that exchange balances are falling, whales are net buyers, and systemic leverage is materially lower than during the summer’s speculative peaks.

Coinbase Institutional echoed that view, stating in a Tuesday X post that its systemic leverage ratio — which tracks purely speculative positioning — has stabilized near 4% to 5% of total market cap, down from around 10% in mid-2025. “Lower leverage = healthier market structure,” the firm wrote.

Still, small retail wallets are distributing into strength while large wallets accumulate, a pattern Misir characterized as “classic late-cycle behavior.”

Markets brace for Powell as rate cut odds near 90%

The broader setup remains dominated by today’s Federal Open Market Committee meeting, with futures markets and prediction platforms pricing in 87% to 89% probability of a 25-basis-point cut.

However, consensus among analysts is that the cut is largely priced in, and that Powell’s tone — particularly around the Fed’s balance sheet and 2026 easing path — will determine whether crypto builds on Tuesday’s rebound.

QCP Capital said Asia opened to a “calmer but cautious” market, noting that Bitcoin ETF inflows picked up modestly after more than $1.1 billion in weekly redemptions through November. The firm stated that bitcoin remains in a clear holding pattern, with derivatives markets signaling hesitation ahead of the event.

K33 also highlighted the unusual setup, citing one of the lowest pre-FOMC confidence levels of 2025 due to delayed economic data and mixed macro signals, increasing odds of sharper-than-usual volatility.

CME futures activity has dried up, with volatility in open interest falling to 0.34%, one of the lowest readings on record. According to K33 Head of Research Vetle Lunde, the pattern has historically preceded major market moves.

Historical FOMC patterns lean bearish amid mixed sentiment

Bitcoin has reacted negatively to six of seven FOMC decisions this year. High-low swings ranged from 6% to 29%, and only the May 7 meeting produced a short-term rebound of 15%, according to The Block’s BTC price page. Multiple analysts cited the pattern as a reason for caution, even as ETF demand returned.

Positioning has already begun to deleverage ahead of the event. CoinGlass data shows $317 million in short liquidations over the past 24 hours, part of a broader washout that experts say cleared speculative excess built earlier in the quarter.

QCP warned that despite steadier conditions, the tone “remains cautious rather than constructive,” with bitcoin essentially flat on the year after peaking above $123,000 in mid-2025. K33 added that options markets show a firmly defensive stance, with six-month skews at their highest put-premium levels since 2022, reflecting heightened demand for downside hedging.

What’s next: ETF demand vs. Fed communication

BRN's Misir said the market now trades on “two pillars: Fed outcomes and whether ETF demand sustains the renewed bid.”

A convincingly dovish message, he argued, could open a path back to the $96,000 to $106,000 zone. Alternatively, a more cautious Powell could quickly send bitcoin back toward the mid-$80,000s.

QCP also pointed to the next major catalyst after the Fed’s decision — the Bank of Japan’s Dec. 19 meeting — where rising JGB yields and USDJPY carry positioning could inject fresh volatility into global markets, including risk assets like crypto, according to the firm’s Wednesday update.