Crypto ETFs diverge: Bitcoin suffers $60M outflows; ETH, SOL, XRP funds in green

  • BTC ETFs recorded $60.48M withdrawals on December 8.
  • Ethereum funds extended their latest momentum with $35.49M inflows.
  • XRP and Solana ETFs ended yesterday with gains amid prevailing demand.

The digital tokens space remains choppy ahead of the December 10 Federal Reserve decision on interest rates.

Crypto exchange-traded funds, which have become vital in gauging institutional appetite in these risk assets, confirm the current uncertainty.

Bitcoin ETFs suffer outflows despite IBIT’s gains

Interest around BTC ETFs remained negative yesterday, with the products recording net outflows amounting to $60.48 million (SoSoValue data).

The significant withdrawals came as investors reacted to the weekend’s sluggish performance across the crypto landscape.

Bitcoin failed to break $92,000 again, currently trading at $90,150.

However, Monday was not gloomy for all BTC ETF issuers.

BlackRock proved its resilience and dominance as its IBIT attracted $28.76 million in inflows.

While funds like Graycale’s GBT (-44.03M) and Fidelity’s FBTC (-39.44M) saw substantial withdrawals on December 8, IBIT’s steadiness indicates that profit taking, not a shift in interest, likely triggered the mixed flows into Bitcoin.

Ethereum ETFs flip positive

While Bitcoin bled on December 8, Ethereum exchange-traded funds turned positive with $35.5 million inflows.

Notably, the funds recorded substantial exits in the previous two sessions, on December 4 (-41.5M) and December 5 (-75.2M).

Indeed, Ethereum has been on the investor radar lately following its Fusaka upgrade, which targets enhanced speed, scalability, and lower costs for Ether-based Layer 2 platforms.

Moreover, the inflows indicate that investors are viewing Ethereum as a legitimate token for portfolio diversification beyond Bitcoin.

Indeed, the second-largest crypto by value is experiencing renewed interest from institutional participants.

For example, BlackRock is seeking the SEC’s authorization for a new staked Ether trust ETF – the ETHB.

The proposed product differs from BlackRock’s popular ETHA trust in that the staking Ether trust will track Ethereum’s performance and include incentives gained from the trust’s staked Ether.

ETH is trading at $3,124 after gaining more than 10% the past seven days.

Solana ETFs see steady demand

Solana spot products closed the previous day with $1.2 million inflows.

While the figure remains modest, it reflects consistent demand for SOL ETFs.

Monday’s inflows have extended their winning streak to three days, demonstrating appetite for these products despite broader turmoil.

Solana exchange-traded funds have attracted roughly $639 million since their late October debut.

Meanwhile, SOL price is hovering at $133, down 2% the past 24 hours.

XRP ETFs steal the show

Ripple’s crypto asset stood out on December 8, with a net inflow of $38.04 million, eclipsing peers for the day.

Grayscale led as its GXRP drew over $810K in fresh capital on Monday.

Also, Canary, Bitwise, and Franklin’s XRP exchange-traded funds recorded notable daily gains.

Regulatory clarity and XRP’s unique utility in cross-border transactions have elevated the altcoin’s appeal among institutional investors.

Nevertheless, the December 8 ETF performance sends a clear message.

Investors are now diversifying into other cryptos beyond Bitcoin.

Altcoin ETFs are gaining traction for their added advantages, as the crypto industry gains increased acceptance in mainstream finance.

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Argentina moves to reshape crypto rules as banks prepare for Bitcoin services

  • A new framework would allow trading, custody, and approved coins.
  • Banks must follow strict KYC, AML, and CNV regulations.
  • High inflation has pushed people toward Bitcoin and stablecoins.

Argentina is preparing for a major shift in how its financial system treats digital assets, with regulators working on a plan that could allow banks to offer Bitcoin and other crypto services for the first time in three years.

The move marks a notable shift for a country where crypto has become a day-to-day tool for people trying to manage inflation, and it signals a wider effort to bring informal crypto activity into regulated channels.

The change remains under review, but internal planning shows that Argentina wants its banking system to play a formal role in crypto access, custody, and compliance.

Banks and crypto rules evolve

Argentina’s central bank, the Banco Central de la República Argentina, has restricted banks from handling crypto since May 2022.

The regulation was designed to contain financial risks and prevent money-laundering activity during a period of economic instability.

The policy now sits at the centre of a broader reassessment of how digital assets fit into a financial system that is struggling with persistent inflation and rising demand for stable alternatives.

Since December 2023, the arrival of President Javier Milei has reshaped the conversation.

His administration has promoted financial freedom, arguing that people should be able to choose different forms of money, including Bitcoin.

This shift has influenced how regulators approach the current ban and has accelerated work on a new framework.

New framework plans grow

Reports indicate that the central bank is developing a system that would permit banks to integrate crypto into their services.

The plan includes trading access, custody options, and a list of approved coins, limited to assets such as BTC, ETH, USDC, USDT, and XRP.

Banks would need to comply with strict rules under the CNV, follow enhanced KYC and AML procedures, and operate crypto activities through legally separate units with additional capital, security, and liquidity requirements.

The approach represents a transition from prohibition to controlled participation.

Argentina would be one of the first inflation-hit economies to regulate crypto within mainstream banking rather than leaving it to informal platforms.

The change also aims to reduce regulatory gaps and improve transparency across transactions that citizens already rely on to protect their savings.

Inflation pressures fuel demand

Crypto adoption has grown rapidly in Argentina over the past three years as households look for ways to preserve value.

With inflation reaching 1,427% in 2023 and still rising more than 2% each month, people have turned to Bitcoin and dollar-linked stablecoins to manage daily expenses, store money, and avoid exposure to the peso’s depreciation.

Regulators now want this activity to operate under formal safeguards.

Allowing banks to support crypto services would offer a safer environment, limit the use of unregulated exchanges, and help authorities strengthen financial monitoring.

It would also create a more structured relationship between digital assets and traditional banks during a period of economic stress.

Timeline points to 2026

Although approval is not final, experts suggest that the updated rules could be ready around April 2026. Work on the technical structure is already underway.

If the proposal moves forward, Argentina could become a key example of how a country facing extreme inflation integrates crypto into conventional financial channels.

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CoinDCX data reveals India’s rising appetite for diversified digital assets

  • CoinDCX users now hold an average of five tokens, up from two to three previously.
  • Women investors doubled year on year with broader diversification trends.
  • Millennials remain the dominant user base as the average age rises to 32.

Indian crypto investors are showing a stronger preference for diversified digital asset portfolios, marking an early shift toward more deliberate and long-term allocation behaviour.

CoinDCX’s annual report, released on Thursday, suggests that the country’s retail investor base is gradually moving away from the idea that crypto is synonymous with Bitcoin, signalling broader maturity in market participation in 2025.

This trend reflects a market becoming more confident, curious, and willing to explore varied opportunities across the expanding digital ecosystem.

The exchange found that the average user now holds around five tokens, compared with two to three in 2022.

This steady expansion of holdings indicates a growing awareness of portfolio construction and a willingness to explore different parts of the crypto market beyond the most established assets.

Layer-1 tokens lead activity

CoinDCX reported that layer-1 assets accounted for 43.3% of portfolio volumes.

Bitcoin, priced at $93,133, held a 26.5% share of allocations. Memecoins made up 11.8% of user portfolios, showing that speculative interest remains a part of broader diversification trends.

According to the exchange, Indian traders have become increasingly comfortable navigating different digital asset categories as adoption widens across the country.

The report noted that crypto is emerging as a natural extension of the financial products already familiar to many users.

Millennials dominate participation

The platform’s user base is ageing upward, with the average trader now 32 years old. Millennials continue to make up the majority of users, outpacing Gen Z in adoption, though younger traders remain active.

Gen Z users, aged 18 to 24, tend to favour emerging narratives such as layer-2 ecosystems, memecoins, and non-fungible tokens. Their behaviour reflects a greater appetite for thematic or speculative sectors.

CoinDCX also saw its number of women investors double year on year. These users are diversifying beyond Bitcoin and Ether, priced at $3,183, into tokens such as Solana at $143.04 and Sui at $1.67.

Founded in 2018 and backed by Coinbase, CoinDCX is one of India’s largest crypto exchanges with more than 20 million registered users. It remains a key gateway for retail access to digital assets.

India shows wide but shallow adoption

CoinDCX noted that India continues to lead in early indicators of digital asset awareness, including mobile-first trading behaviour and high engagement across educational content on the platform.

These signals reflect strong nationwide interest in crypto as a financial category.

However, the exchange found that deeper, research-driven participation remains limited. Many users enter the market through popular assets or trending narratives rather than sustained ecosystem involvement.

As a result, the platform characterised India’s adoption as “wide” but not yet “deep”.

CoinDCX said the country is still in the early stages of its digital asset journey, leaving significant room for education, innovation, and long-term growth as user sophistication develops.

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BTC staking platform Babylon teams up with Aave for Bitcoin-backed DeFi insurance

  • Babylon and Aave partner to enable native BTC as collateral for DeFi lending.
  • BTC can now back decentralised insurance pools, earning yield if unused.
  • Users retain full control of their Bitcoin while accessing DeFi liquidity.

In a groundbreaking move for the decentralised finance (DeFi) ecosystem, Bitcoin staking platform Babylon has announced a partnership with Aave, one of the largest decentralised lending protocols.

The collaboration aims to allow Bitcoin (BTC) holders to use their native, unwrapped BTC as collateral for lending and to participate in a pioneering DeFi insurance model.

This will reshape how Bitcoin interacts with DeFi, unlocking liquidity while maintaining the security that Bitcoin users expect.

Native Bitcoin collateral comes to DeFi

Traditionally, using Bitcoin in DeFi required wrapping it into a tokenised version such as WBTC, which introduced custodial risk and extra steps.

Babylon’s partnership with Aave eliminates this barrier by enabling users to deposit their native BTC directly as collateral.

Through Babylon’s trustless Bitcoin Vaults, BTC can be locked in a time-locked contract on its own blockchain and recognised by Aave’s hub-and-spoke lending architecture.

This allows users to borrow stablecoins or other crypto assets while keeping full control of their Bitcoin keys.

The move is expected to significantly expand BTC liquidity in DeFi. Currently, even the largest wrapped Bitcoin initiatives account for less than 1% of Bitcoin’s total market cap.

Babylon’s own staking product secures over 56,000 BTC, demonstrating strong demand for productive uses of Bitcoin.

By unlocking native BTC for lending, the partnership could bring a substantial portion of the dormant Bitcoin supply into productive DeFi applications, potentially transforming lending markets.

DeFi insurance backed by Bitcoin

Beyond lending, Babylon is preparing to extend its vaults into the insurance sector, a development that could redefine how DeFi protocols manage risk.

The proposed model allows BTC holders to deposit their Bitcoin into decentralised insurance pools.

These pools would serve as coverage against protocol hacks and other failures.

Depositors earn yield if no claims occur, while the pool provides liquidity for payouts in the event of a validated exploit.

This approach turns Bitcoin into a foundational asset for DeFi risk management, offering a new avenue for yield generation while safeguarding the ecosystem.

Babylon co-founder David Tse told CoinDesk that the insurance initiative is still in development, with an official announcement expected in January 2026.

Testing for the integrated BTC lending and insurance products is scheduled to begin in early 2026, with a broader rollout planned around April of the same year.

The combination of Babylon’s secure vault design and Aave’s extensive liquidity network creates a framework that prioritises both safety and usability, a balance often missing in cross-chain and custodial solutions.

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Glassnode report reveals Bitcoin’s growing stability amid ETF activity and RWA expansion

  • Bitcoin’s 2025 cycle shows rising institutional flows, lower volatility, and deeper liquidity.
  • Tokenized real-world assets surge to $24 billion, boosting institutional adoption and on-chain activity.
  • ETFs reshape Bitcoin liquidity as stablecoins remain key rails in a more mature digital asset market.

Bitcoin’s latest cycle is developing under a very different market structure, with data from Glassnode and Fasanara Capital pointing to deeper institutional participation, rapid growth in tokenized real-world assets, and a notable drop in volatility.

Their Q4 Digital Assets Report highlights how Bitcoin’s behaviour has shifted as regulated investment channels expand, and liquidity becomes more stable across spot, derivatives, and on-chain markets.

The findings show how ETF flows, settlement activity, and broader adoption of tokenised instruments are shaping a more mature phase in the digital asset ecosystem.

These structural changes are defining how capital moves through Bitcoin in 2025.

Institutional flows reshape the cycle

The report estimated that Bitcoin has absorbed around $732 billion in new capital during this cycle.

This has occurred alongside a clear decline in one-year realised volatility, which has fallen by nearly half.

Glassnode linked this trend to increased depth across major markets and a larger share of trading driven by institutional strategies.

Glassnode also reported that Bitcoin settled approximately $6.9 trillion over the past 90 days.

This puts Bitcoin in a range comparable to payment networks such as Visa and Mastercard.

Even with more trading moving into ETF and brokerage channels, the report found that Bitcoin and stablecoins still dominate value transfer on public blockchains.

ETF channels deepen liquidity

ETF-linked demand has reshaped how investment enters and exits Bitcoin.

Instead of relying mainly on on-chain movement or exchange activity, a greater share of flows now passes through regulated investment vehicles.

According to the report, this shift has encouraged smoother liquidity conditions and fewer sharp price changes in spot markets.

Traditional market makers and arbitrage firms have increased their presence due to ETF participation.

Their involvement has tightened spreads and reduced disruption during periods of heightened selling pressure.

This development reflects a broader alignment between digital asset markets and established financial infrastructure.

Tokenized RWAs accelerate

Tokenized real-world assets have expanded from $7 billion to $24 billion within one year.

Glassnode stated that this rise reflects stronger institutional demand, including interest from pension funds, hedge funds, and corporations that want on-chain exposure to familiar financial instruments.

Tokenized funds have gained momentum as asset managers test new distribution models and investors seek simplified access to traditional assets.

Platforms involved in tokenised RWAs have strengthened custody, settlement, and compliance systems.

This foundation has encouraged consistent inflows throughout 2025, supporting a growing segment of the market that links traditional assets with blockchain settlement rails.

Stablecoin role strengthens

Glassnode described the market structure as larger and more stable than in previous cycles.

The data indicated deeper liquidity across spot, derivatives, and on-chain channels, which has contributed to a more measured trading environment.

Reduced volatility has become a defining feature of the cycle, shaped by institutional trading strategies that tend to use steady allocation models.

Stablecoins continue to serve as key connectors between traditional and digital financial systems.

The report stated that stablecoin settlement demand remains substantial across centralised and decentralised platforms.

Glassnode characterised the dual-rail system created by stablecoins and traditional infrastructure as a permanent part of the ecosystem, supporting both institutional flows and retail trading activity.

Analysts referenced in the report expect institutional participation to expand as tokenised funds gain broader acceptance.

Glassnode presented this phase as a turning point marked by heavier institutional flows, rising tokenisation, and reduced volatility.

These factors suggest that Bitcoin and the wider digital asset sector are moving into a more structurally mature environment in 2025.

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