Bitcoin exchange-traded funds (ETFs) saw a modest net inflow of $15 million last week, signaling a slight recovery after the previous week’s sharp outflows of over $713 million. However, this small inflow is the lowest since the beginning of 2025, highlighting investor caution despite the positive shift in Bitcoin prices. While the modest rebound in Bitcoin’s price to $87,641 represents a 3% increase, other indicators suggest that market participants are not fully convinced by this rally.

Between April 14 and April 17, institutional investors contributed to Bitcoin spot ETFs, bringing the net inflows into these products to $15.85 million. Despite this recovery, the figure still falls short compared to the higher inflows seen earlier in the year. The modest inflow suggests a slowdown in institutional enthusiasm for Bitcoin, reflecting broader market uncertainty.

A significant factor contributing to the cautious sentiment is the escalating global trade tensions, which have introduced new risks to financial markets. As major economies tighten their trade policies and retaliatory measures mount, institutional investors have adopted a wait-and-see approach. This shift in investor behavior has resulted in a reallocation of capital, with many investors refraining from making large commitments to risky assets like Bitcoin. This uncertainty has led to a decline in investor confidence, as evidenced by the relatively low net inflows into Bitcoin ETFs.

Despite the rise in Bitcoin’s price, there are signs that traders are not fully embracing the rally. Bitcoin’s futures open interest has decreased by 2%, which means that traders are closing their positions rather than opening new ones. This reduction in open interest during a price rally signals a lack of conviction in the sustainability of Bitcoin’s price movement. In other words, while Bitcoin has gained in value, many traders are not confident that the price will continue to rise.

Additionally, the options market is reflecting bearish sentiment, with a higher demand for put options. When the number of put options exceeds call options, it indicates that traders are anticipating a potential price decline or seeking protection against possible losses. This market behavior suggests that, despite the recent price increase, many investors are positioning themselves for a downturn or protecting themselves from potential volatility.

However, Bitcoin’s positive funding rate of 0.0052% offers some hope for bullish sentiment. A positive funding rate means that long traders are paying shorts, which indicates that there is higher demand for long positions and a general inclination toward a bullish outlook. This positive funding rate suggests that there are still traders who remain confident in Bitcoin’s potential for growth, even as caution dominates the broader market.

In conclusion, while Bitcoin’s ETFs have experienced a modest rebound, the inflows remain significantly lower than earlier in the year, pointing to caution among investors. The ongoing global economic uncertainties and trade tensions have created a challenging environment for riskier assets like Bitcoin. Moreover, the declining open interest and growing demand for put options indicate that many traders are not fully convinced by the recent price gains. Despite this, Bitcoin’s positive funding rate signals that some traders remain optimistic about its future prospects. The market is currently treading cautiously, waiting for clearer signs of direction before making larger investments.