Key highlights:
- Bitcoin spot ETFs have recorded four straight days of positive net inflows.
- Total monthly inflows are at $800 million, with experts pointing to the Coldcard hack as the trigger.
- Eric Balchunas noted that Bitcoin ETFs are a worthy alternative for long-term Bitcoin investing.
Bitcoin spot ETFs have started August with a bang, raking in nearly $800 million in four trading days to shake off the dry spell in July. However, experts say the resurgence is linked to the ongoing Coldcard hack as BTC holders move funds from hardware wallets to the safety of
Bitcoin ETFs recorded their lowest-ever monthly net inflows in July, closing the month with a meagre $172 million. For context, the second-lowest monthly net inflow stood at $667.10 million in June 2024, with August already exceeding both months in four trading days.
Senior ETF analyst at Bloomberg Eric Balchunas noted that the surge in inflows may be linked to the Coldcard hack incident currently rocking the Bitcoin ecosystem. At the tail end of July, hackers drained over $116 million worth of Bitcoin from more than 5,200 addresses after exploiting a firmware flaw in how Coldcard devices generated random seed phrases.
$IBIT, $FBTC, $BITC, $ARKB, $MSBT have all seen inflows every single day (and growing each day) since the Coldcard Hack this wknd for a total of $620m. I’m not saying it’s connected, we just don’t know, altho long-term I can’t imagine there aren’t some who migrate over, but it’s… pic.twitter.com/Y63ZUKsVJD
— Eric Balchunas (@EricBalchunas) August 6, 2026
The jarring hack put the entire hardware wallet industry under pressure, with investors turning to the relative safety of Bitcoin ETFs. However, hardcore Bitcoiners are taking swipes at the capital flight to ETFs, branding it as a pivot from the ethos of self-custody and financial sovereignty.
Using Bitcoin ETFs is not selling out
Eric Balchunas rose to the defence of investors turning from self-custody to ETFs, noting that “using an ETF is not selling out.” The analyst argued that ETFs are “lean and mean,” a stark difference from the typical hedge funds on Wall Street.
He added that Bitcoin ETFs are as “punk rock as you can get” while still reaping the benefits of the relative safety of robust regulations. Balchunas cited BlackRock’s employee strength and the scale of assets under its management as a better alternative than a five-man boutique company in Canada.
However, Balchunas noted that ETFs have several limits since they cannot be used to bypass censorship. For long-term investing, Balchunas said Bitcoin ETFs are a better alternative than hard wallets since it largely erases the risks associated with self-custody.
“If you want to transact in BTC (or use it to flee a country or censorship), an ETF is not gonna help, and I think it’s important that BTC be used that way. But for the basic reason of long-term investing, I’m hard-pressed to find a reason to use anything but an ETF.”
Source:: Coldcard Hack Boosts Inflows to Bitcoin ETFs After a Poor Run in July