Bitcoin ETFs Spur $946M Outflow; Solana, ETH Draw Inflows
Last week saw a $360 million crypto outflow from digital asset investment products after Federal Reserve Chair Jerome Powell cautioned that December rate cuts were “not a foregone conclusion.” Bitcoin ETFs led the withdrawals, with $946 million exiting, including $390 million from iShares Bitcoin Trust and $156 million from Fidelity’s Wise Origin Bitcoin Fund. Bitcoin traded near $107,727, down 12% over the past month. This crypto outflow underscores trader concerns over prolonged high interest rates and policy uncertainty.
In contrast, investors rotated into altcoin vehicles: Solana’s newly launched US staking ETFs attracted $421 million, Ethereum funds recorded $57.6 million in inflows, and XRP, Sui, and Litecoin combined for $54 million gains. Regional trends diverged as German and Swiss products saw $32 million and $30.8 million inflows respectively. The shift highlights demand for yield-bearing assets and diversification amid continued policy uncertainty.
Bearish
The significant $946 million outflow from Bitcoin ETFs, driven by concerns over delayed rate cuts and sustained high interest rates, exerts downward pressure on Bitcoin’s price in the short term. While altcoins like Solana and Ethereum benefit from inflows, Bitcoin’s net redemptions signal a bearish sentiment among institutional investors. Over the long term, policy clarity and renewed demand for yield-bearing products could stabilize markets, but for now, the dominant selling in Bitcoin ETFs points to continued bearish pressure.