Bitcoin News Today: Investor Fears Trump Tariffs Fuel Inflation, Spooking Crypto ETFs

Bitcoin and Ether ETFs recorded significant outflows following the release of the Federal Reserve’s inflation data, which showed rising price pressures amid the administration of U.S. President Donald Trump. Ether (ETH) ETFs experienced a net outflow of $164.64 million, marking the end of five consecutive days of inflows that had boosted the asset class by over $1.5 billion. Bitcoin (BTC) ETFs also faced outflows of $126.64 million, their first daily loss since August 22 [1].

The outflows coincided with the release of the core Personal Consumption Expenditures (PCE) index, the Fed’s preferred inflation gauge, which reported a 2.9% annualized rise in July—the highest since February. The data reinforced concerns that Trump’s tariff regime is increasing import costs and contributing to inflationary pressures, as noted by CNBC. Trump’s administration has imposed a baseline 10% tariff on all imports and additional targeted duties, which have reportedly elevated core price pressures despite a moderation in energy costs [1].

Market participants continued to price in the likelihood of a Federal Reserve rate cut at its next meeting, provided labor market data signals further signs of weakness. This suggests that while investors are reacting to short-term inflation risks, they remain focused on potential easing from the Fed. The response to the inflation report highlights the sensitive interplay between macroeconomic data and digital asset investment flows [1].

Among Bitcoin ETFs, Fidelity’s FBTC recorded the largest single-day outflow at $66.2 million, while ARK Invest and 21Shares’ ARKB followed with a $72.07 million net withdrawal. Grayscale’s GBTC also experienced outflows of $15.3 million, contrasting with minor inflows into BlackRock’s IBIT, which added $24.63 million, and WisdomTree’s BTCW, which gained $2.3 million [1].

Despite the recent outflows, Ether ETFs have maintained strong growth since their launch in July 2024, with net inflows rising 44% in August from $9.5 billion to $13.7 billion. Analysts attribute this resilience to a rebound in institutional demand after a period of underperformance relative to Bitcoin. Additionally, the adoption of Ether by corporate treasuries has accelerated, with companies now holding 4.4 million ETH, valued at over $19 billion—approximately 3.7% of the total supply [1].

Data from Farside Investors further illustrates the volatility in ETF flows across major Bitcoin products. For example, on August 19, the total outflow reached $523.3 million, with significant withdrawals from IBIT, FBTC, and ARKB. Over the reporting period, Bitcoin ETFs showed an average daily inflow of $142.7 million, but this figure masked sharp fluctuations, with maximum inflows reaching $1,119.9 million and outflows hitting as high as $430.8 million on certain days [2].

Source: [1] Bitcoin, Ether ETFs See Outflows as Fed Flags Inflation (https://cointelegraph.com/news/bitcoin-ether-etfs-see-outflows-fed-inflation-trump-tariffs) [2] Bitcoin ETF Flow (US$m) (https://farside.co.uk/btc/)