US spot Bitcoin and Ether ETFs posted a combined $530 million in net outflows Thursday, November 6, 2026, as election gains quickly evaporated. Bitcoin ETFs recorded $430 million in outflows while Ether ETFs lost approximately $100 million, according to SoSoValue data.
This reversal followed $128 million in combined inflows Wednesday when Democrats' victories in the US midterm elections sent Bitcoin briefly above $80,000. The market shift occurred as Bitcoin fell back below $76,000 and the tech-heavy Nasdaq Composite plunged 5.5% on Thursday. That was the Nasdaq's biggest single-day decline since April 2025.
Fidelity's Wise Origin Bitcoin Fund (FBTC) led Thursday's outflows with roughly $200 million. The fund had attracted around $237 million on Wednesday before the reversal. This daily swing represents a significant shift in institutional sentiment.
BlackRock's iShares Bitcoin Trust (IBIT) recorded another $105 million in net outflows. The latest withdrawals extended IBIT's outflow streak to five consecutive sessions, with more than $1 billion withdrawn since October 30. Bitcoin ETFs' year-to-date net outflows now stand at around $510 million.
Crypto analyst Michaël van de Poppe said on X Thursday that Bitcoin could find a near-term bottom Friday, potentially after dipping below $75,000, pointing to the severity of the Nasdaq's decline. "I expect Nasdaq to bottom tomorrow. The same for Bitcoin, potentially after sweeping $75,000," he wrote.
The current market environment differs from the period leading up to the 2008 financial crisis, according to Dean Lyulkin, CEO of Cardiff and founder of investment publication The Dean's List.
The global financial crisis wasn't caused by Democrats taking Congress, Lyulkin noted, pointing out that the Federal Reserve had already raised interest rates substantially and the housing market was weakening before the crisis.
While acknowledging vulnerabilities in commercial real estate, private credit and potentially excessive artificial intelligence spending, Lyulkin argued that household balance sheets and the banking system are considerably stronger today.
Meanwhile, Ethereum prepares to overhaul its state structure with a Partitioned Binary Tree (EIP-8297) that aims to deliver smaller state proofs and enable state expiry without taking the network offline. The proposal passed a mainnet shadowfork test on October 29, 2026, and full deployment is slated for Q4 2026.
The Partitioned Binary Tree design keeps related data closer together through partitioned key sorting, which organizes account headers, contract storage and contract code into a single binary tree structure. The design also removes RLP encoding, Ethereum's current serialization format, which should simplify proving processes.
The upgrade is explicitly designed not to change gas schedules or alter how the EVM operates. Existing contracts and users should not notice anything different. Wallets keep working, contracts keep running, and nobody has to rewrite code.
What to keep an eye on next are additional shadowfork rounds, results from other execution clients, and an announced mainnet activation date. Until that date lands, Q4 2026 remains a target rather than a commitment. The risks are mostly about execution, with only Besu's results from the shadowfork detailed here.
Ethereum runs on multiple client implementations that all need to convert their state correctly. ### U.S. Spot ETF Flows Comparison
## Ethereum's Upcoming Structural Overhaul Ethereum's upcoming Partitioned Binary Tree (PBT) upgrade will fundamentally reorganize how the blockchain stores and accesses data. Traditional hexary Merkle Patricia Trie will be replaced with a simpler binary tree structure that supports easier state verification and future state expiry capabilities. The PBT design eliminates complex serialization formats like RLP encoding, potentially reducing proving system bottlenecks. By organizing keys into designated zones, related data will be stored closer together, which should improve overall system efficiency. The upgrade passed critical testing on October 29, 2026, with shadowfork results showing successful state reconstruction across different client implementations. Q4 2026 remains the target timeframe for full mainnet deployment. **Risk factor:** The upgrade maintains existing gas schedules and EVM operations, ensuring backward compatibility while gradually improving underlying infrastructure efficiency.
Investment Implications
Institutional investors face difficult decisions as cryptocurrency markets experience sharp reversals. The recent outflow pattern suggests market participants may need to reassess risk management strategies, especially around exchange-traded fund allocations. Portfolio managers should consider staggered entry points and diversified exposure strategies rather than concentrated positions during volatile periods. Market timing remains critical for capital preservation in the evolving cryptocurrency landscape.
Ethereum's Database Transformation
The Ethereum network is preparing for a significant database overhaul that could reshape how it stores blockchain state information. This ambitious upgrade aims to simplify data management and improve verification processes across the ecosystem.
The proposed changes will impact how nodes interact with blockchain data, potentially making the system more efficient and scalable for future growth. Developers and users will need to monitor these technical shifts closely as they unfold.
Technical Assessment
The Partitioned Binary Tree represents a methodical approach to Ethereum's state management challenges. By moving away from complex trie structures, Ethereum could achieve more streamlined data organization and improved scalability. The upgrade's design ensures backward compatibility, allowing existing contracts and user applications to operate without disruption. This gradual approach minimizes potential systemic risks while delivering foundational improvements to blockchain infrastructure.
Investment Outlook
With Bitcoin ETFs experiencing consistent outflows, institutional sentiment appears shifting toward more cautious positioning. The extended outflow streak suggests underlying market uncertainties that may present opportunities for selective re-entry. Investors should monitor Q4 2026 Ethereum upgrade timeline and ETF flow patterns.
Current market conditions indicate a potential inflection point for strategic reallocation toward promising blockchain infrastructure projects. Ethereum's Partitioned Binary Tree represents a fundamental infrastructure shift that could reshape blockchain state management. The upgrade aims to simplify data organization and support stateless client development, potentially enhancing network efficiency.
Unlike speculative investments, this technical improvement focuses on operational streamlining rather than price speculation. The upgrade maintains backward compatibility, ensuring minimal disruption to existing ecosystem participants while laying groundwork for long-term scalability. Market participants should distinguish between ETF flow dynamics and underlying technological progress, recognizing that infrastructure improvements remain valuable despite short-term price fluctuations.