TL;DR
- US ETF inflows hit a record $1.4T in 2025 as the $13T industry also logged 1,000+ launches and peak volume.
- The S&P 500 posted a third straight double-digit year; Bloomberg noted 2021 was the last time flows, launches, and volume peaked together.
- On Dec. 23, Bitcoin spot ETFs lost $189M and Ether ETFs $95.52M, yet attention shifted to the Dec. 24 to Jan. 5 rally; S&P Tuesday closed at 6,909.79.
ETF money flooded US markets in 2025 at a pace never seen before. With about a week left on the calendar, the $13 trillion ETF industry had already locked in records across flows, product launches, and trading activity. Inflows hit $1.4 trillion, beating last year’s all-time high. More than 1,000 new ETFs launched, and trading volume set a yearly peak. With the tally effectively locked, momentum did not fade into year-end, as cash kept rotating in daily. For issuers and allocators, the story was scale plus speed in the wrapper market.
Stocks powered demand as crypto funds leaked
The run built on a rise in US equities. The S&P 500 notched a third straight year of double-digit gains, even while trading sideways from October. That range-bound tape did not stop ETF volumes from climbing into the close, despite doubts about outsized AI spending plans and open questions on when the Fed cuts rates. Bloomberg data in the write-up notes 2021 was the last year when flows, launches, and volume peaked together. Issuers shipped products, and buyers kept showing up. Equity momentum turned ETFs into the default implementation vehicle.
That backdrop also invites comparisons to the post-2021 hangover. After a strong 2021, risk assets sold off, and the S&P 500 fell 19% in 2022. Government bonds offered little protection as the Fed hiked quickly, leaving portfolios exposed on both sides. Trading stayed active, but flows and launches cooled as volatility hit. Bloomberg Intelligence senior analyst Eric Balchunas said next year could bring “some reality check,” and that after such a “perfect” ETF year, investors should brace for issuers and advisers. Perfection tends to raise expectations and compress room for error.
Late-December flow data showed a fault line in crypto wrappers. Bitcoin spot ETFs saw $189 million of net outflows, the fourth straight day of redemptions, with BlackRock’s IBIT at $157 million. Ethereum spot ETFs lost $95.52 million, and all nine products posted zero inflows. Yet the market still focused on the Santa Claus rally window from Dec. 24 to Jan. 5, when the S&P 500 averages 1.3% and is positive 78% of the time. Equities ended Tuesday up about 0.5% at 6,909.79, extending the record close.
