Bitcoin News Today: Investors Flee Crypto ETFs as Powell’s Speech Looms

ETF outflows have accelerated in recent days amid market uncertainty, signaling increased risk aversion as investors await Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole symposium. According to recent data, spot Bitcoin and Ethereum ETFs recorded nearly $1 billion in combined outflows on August 19, 2025, with Bitcoin ETFs alone losing $523 million on the day. Fidelity’s Fidelity Wise Origin Bitcoin Fund (FBTC) saw the largest single-day outflow at $246.9 million, while Grayscale’s Bitcoin Trust (GBTC) lost $115.53 million. Ethereum ETFs also faced significant redemptions, with $422.3 million in outflows, marking the second-largest single-day withdrawal since their launch [1].

The outflows have coincided with a sharp price correction in both Bitcoin and Ethereum. Bitcoin fell to as low as $112,000 in early August, its lowest level since the beginning of the month, while Ethereum dropped more than 8% in the past week. The downturn has contributed to shifting investor sentiment, with the Crypto Fear & Greed Index flipping to “Fear” after a month of “Greed.” Despite the recent outflows, however, assets under management for Bitcoin ETFs remain at record levels, with a combined $14.6 billion, while Ethereum ETFs hold approximately $2.6 billion [2].

The broader market context appears to be driven by anticipation of Powell’s Jackson Hole speech, which will occur on August 23, 2025. Analysts at Evercore ISI warned of potential market volatility following the speech, projecting a possible 7% to 15% pullback in equities as investors react to any hints of a 25-basis-point rate cut in September. The Fed’s dual mandate of stable prices and maximum employment remains a central challenge, as recent economic data has painted a muddled picture. Inflation remains above target, while job growth has slowed to its weakest three-month pace since 2010. Meanwhile, the Trump administration has pushed for aggressive rate cuts, despite concerns from within the Fed about the risks of premature action [3].

In response to the uncertainty, Evercore ISI recommended that investors maintain a core portfolio of AI enablers and adopters in the communication services, consumer discretionary, and technology sectors. These include major firms like Amazon, Alphabet, and Micron. The firm also advised supplementing such holdings with attractively valued stocks in sectors like healthcare, while reducing exposure to overvalued names with weaker earnings outlooks, such as Tesla and Palantir. Such strategic adjustments could help mitigate the potential downside should market conditions deteriorate further [1].

The Federal Reserve is also expected to signal a shift in its policy framework during Powell’s speech, particularly with regard to average inflation targeting. The policy, introduced in 2020, allowed for periods of inflation above 2% if historical levels were below target. However, with current inflation well above that level, the Fed is likely to abandon the approach and return to a strict 2% inflation target. This shift is seen as a way to restore a more preemptive approach to monetary policy and address the risks posed by supply shocks and imbalances in the labor market [2].

Market participants are closely watching for any indication of whether the Fed will adopt a “one and done” approach to rate cuts or signal a series of reductions in coming months. With the Trump administration and many investors expecting a rate cut in September, the challenge for Powell will be to balance data dependency with the broader economic outlook. If the Fed does cut rates, it could provide short-term relief to financial markets but may also raise concerns about inflation persistence. As the Jackson Hole speech approaches, the stakes for market stability have never been higher [3].

Source:

[1] Crypto Funds Bleed: Bitcoin and Ether ETFs Shed Nearly $1B (https://cointelegraph.com/news/crypto-funds-bleed-bitcoin-outflows-surge-5x-ether-outflows-double)

[2] Spot Ether ETFs See $197M Outflows, Second-Largest Ever (https://cointelegraph.com/news/ether-etfs-197m-outflows-second-largest)

[3] Powell Has Used Jackson Hole to Battle Inflation and Buoy Jobs; He’s Now Caught Between (https://www.reuters.com/business/powell-has-used-jackson-hole-battle-inflation-buoy-jobs-hes-now-caught-between-2025-08-18/)