Bitcoin exchange-traded funds recorded net inflows of $933 million in their latest session, pushing total crypto ETF assets under management to their highest level since February. The move marks the sharpest single-session capital rotation into Bitcoin products in eleven weeks, with institutional flows accelerating after spot Bitcoin ETFs crossed $120 billion in cumulative AUM across eleven U.S. issuers.
Ethereum funds, by contrast, registered net outflows for the fourth consecutive week. Spot Ethereum ETFs lost $47 million during the same period, extending a pattern that began in mid-March when the Ethereum-Bitcoin correlation dropped below 0.72 for the first time since August. XRP funds captured $22 million in net inflows, outperforming Ethereum despite trailing Bitcoin by a wide margin. The shift reflects growing institutional interest in tokenized settlement layers as U.S. banks prepare for regulated stablecoin issuance under frameworks expected later this year.
The divergence matters because Ethereum has historically moved in lockstep with Bitcoin during capital deployment cycles. The current decoupling suggests allocators are treating Ethereum as a distinct asset class rather than a leveraged Bitcoin play. This week's flows also coincide with Ethereum's network gas fees falling to 12-month lows, a sign that transaction demand remains tepid even as layer-two solutions absorb mainnet activity. Meanwhile, Bitcoin on-chain settlement volume rose 18% week-over-week, driven by large transfers between custodial wallets and self-custody addresses.
The immediate follow-on event is the SEC's May deadline for final rulings on three additional Ethereum ETF applications from Fidelity, VanEck, and Franklin Templeton. If approved, total Ethereum ETF capacity could expand by $2.4 billion in seed capital within thirty days. Bitcoin ETF issuers are already positioning for increased competition: BlackRock's iShares Bitcoin Trust reduced management fees by five basis points last week, the first fee cut since launch. Allocators should also track Bitcoin's correlation with the Nasdaq 100, which has tightened to 0.89 as tech equities rally on AI infrastructure spending.
The XRP pivot tells a different story. Institutional flows into XRP funds suggest allocators are front-running a potential settlement between Ripple and the SEC, expected to conclude by late Q2. If Ripple wins or settles favorably, XRP could see accelerated adoption in cross-border payment rails, particularly in Asia-Pacific markets where tokenized FX settlement is already live.