- Digital asset products witnessed $533 million in inflows last week after Jerome Powell hinted at rate cut in September.
- Bitcoin saw $543 million in inflows as investors began flocking in on Friday.
- Ethereum experienced further outflows last week, with other altcoins seeing little or no inflows.
Crypto ETFs recorded the highest inflows in five weeks after Jerome Powell hinted at the possibility of the Federal Reserve’s (Fed) cutting interest rates in September during his speech at the Jackson Hole Symposium. Meanwhile, the altcoin investment market witnessed little or no inflows with Ethereum ETFs seeing outflows totaling $35.7 million last week.
Digital asset investment products see renewed investor interest following $543 million of inflows
Crypto ETFs recorded $533 million in net inflows last week, according to CoinShares' weekly report. This is the highest inflow among crypto ETFs in five weeks, as the crypto market witnessed another week of recovery from the market drawdown on August 5.
Crypto ETF Flows
The increased inflows were largely influenced by Fed Chair Jerome Powell's speech at the Jackson Hole Symposium on Friday, in which he suggested that the time has come for the Feds to lower interest rates if economic data aligns.
The US remained dominant regionally, with inflows totaling $498 million, followed by Hong Kong with $15.9 million in inflows. Switzerland also recorded inflows last week, totaling $13.9 million after a previous week of outflows. Brazil was just a little behind with $8 million in inflows. However, German investors continued to shed their holdings, posting $8.9 million in outflows last week.
Asset-wise, Bitcoin ETFs were majorly responsible for the net inflows, witnessing $543 million of positive last week. The surge in inflows suggests Bitcoin's high sensitivity to the possibility of interest rate cuts, as nearly 50% of the flows came following Powell's speech on Friday. This is also evident in Bitcoin's price, which experienced a 7% rally to $64K on Friday.
Meanwhile, altcoins witnessed negative flows last week, with global Ethereum ETFs recording net outflows totaling $35.7 million.
According to CoinShares, Ethereum ETFs have recorded $3.1 billion in inflows since the launch of the US spot ETH ETFs, but this has largely been offset by heavy negative flows from Grayscale Ethereum Trust (ETHE), which has seen $2.5 billion in outflows.
Crypto ETF FAQs
An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoin’s price. ETF is a tool used by investors to gain exposure to a certain asset.
Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulator’s permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.
Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale – whose application for a Bitcoin spot ETF was initially rejected by the SEC – got a victory in court, forcing the US regulator to review its proposal again. The SEC’s loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Ethereum bulls could stage 30% rally following Fed Chair's keynote, withdrawing over 284K ETH from exchanges
Ethereum is up over 6% on Friday as bulls have initiated heavy buying pressure following indications from US Federal Reserve (Fed) Chair Jerome Powell that an interest rate cut is imminent.
SUI, OP, ZETA lead $160 million crypto token unlocks next week
The crypto market will witness another round of heavy token unlocks next week, with $164.2 million of cliff unlocks entering into the circulating supply of several top altcoins, per crypto intelligence firm Token Unlocks.
XRP trades above $0.60, Ripple whales shed token holdings
Ripple whales holding between 1 million and 10 million XRP tokens slightly decreased their holdings between August 22 and 23. XRP retail traders holding less than 1,000 tokens accumulated the asset, while whales dropped their assets.
Here's why Bitcoin and the crypto market rallied after Fed Chair's speech
Bitcoin has gained nearly 5% alongside a rally across the crypto market in the past 24 hours following indications of interest rate cut from Fed Chair Jerome Powell's keynote on Friday morning.
Bitcoin: Can BTC break above $62,000 barrier?
Bitcoin (BTC) trades above $60,000 on Friday, gaining more than 4% this week so far, but fluctuating within a range between $57,000 and $62,000 for the last 15 days. On-chain data shows contradicting signs, with institutions accumulating Bitcoin while some whales are selling. Additionally, the US spot Bitcoin ETFs recorded inflows this week, and continued Mt.Gox fund movements could bring volatility in Bitcoin's price in the coming days.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.