Bitcoin News Today: Investors Withdraw $223M from Crypto ETPs After Fed's Hawkish FOMC Signal

Last week marked a pivotal shift in the flow of capital into cryptocurrency exchange-traded products (ETPs), with investors withdrawing a total of $223 million, bringing to an end a 15-week consecutive inflow streak. The reversal came in the wake of the U.S. Federal Reserve’s recent Federal Open Market Committee (FOMC) meeting, during which officials signaled a more hawkish stance than anticipated. This shift in tone significantly dampened investor expectations of an imminent rate cut, reducing optimism in the market [1].

The outflows were partially attributed to profit-taking by investors who had benefited from a strong rally over the previous month. Despite a strong start to the week, where inflows reached $883 million, the trend reversed sharply following the FOMC meeting and a series of stronger-than-expected U.S. economic data releases. The cumulative inflows over the past 30 days had reached $12.2 billion, representing half of the year’s total inflows so far, which made the recent pullback appear as a relatively modest correction rather than a definitive reversal [2].

The impact was most pronounced on Bitcoin-related products, which accounted for the bulk of last week’s outflows, totaling $404 million. However, analysts have suggested that the broader narrative remains bullish. Some believe the next major catalyst for Bitcoin could occur after the summer recess, particularly when the U.S. Congress reconvenes post-Labor Day. Historical trends show that fiscal uncertainty often bolsters demand for hard assets like Bitcoin, reinforcing its position as a key player in the crypto market [2].

While the ETP sector experienced a setback, Ethereum (ETH) continued to attract strong investor interest. Ether ETPs recorded their 15th consecutive week of net inflows, pulling in $133 million despite the overall market pullback. This resilience highlights the robust sentiment surrounding Ethereum, which appears to be gaining momentum as institutional and retail investors continue to allocate capital to the asset [1].

Inflows were also observed in other major crypto assets, including XRP, Solana, and Sui, which saw $31.2 million, $8.8 million, and $5.8 million in net inflows, respectively. These figures indicate a broader diversification in crypto fund allocations, with investors maintaining a strategic exposure to a range of digital assets despite macroeconomic headwinds [1].

Amid these developments, the broader cryptocurrency market has shown relative stability, remaining above the $3.7 trillion market cap threshold. Analysts attribute this resilience to structural flows and growing institutional confidence, particularly in light of regulatory clarity in the U.S. market. While short-term volatility is expected, the long-term trajectory of crypto ETPs and funds remains closely tied to macroeconomic developments and central bank policy.

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Sources:

[1] Cointelegraph – [https://cointelegraph.com/news/crypto-funds-223m-outflows-fomc-15-week-winning-streak](https://cointelegraph.com/news/crypto-funds-223m-outflows-fomc-15-week-winning-streak)

[2] advfn.com – [https://mx.advfn.com/bolsa-de-valores/COIN/AMPUSD/crypto-news/96554139/crypto-funds-see-223m-outflow-ending-15-week-str](https://mx.advfn.com/bolsa-de-valores/COIN/AMPUSD/crypto-news/96554139/crypto-funds-see-223m-outflow-ending-15-week-str)