Bitcoin, Ethereum ETFs Saw $147M Net Outflows, Chances Of Second 50-Basis-Point Interest Rate Cut Evaporate

Digital asset investment reported $147 million in outflows last week, driven by stronger-than-expected economic indicators that have diminished the likelihood of substantial rate cuts.

What Happened: According to CoinShares on Monday, spot Bitcoin ETFs saw total net outflows of $159 million, while spot Ethereum ETFs tallied net outflows of $28.9 million.

iShares ETFs like the Ethereum Trust ETHA and the Bitcoin Trust IBIT were the only ETFs seeing net inflows of $191 million over the week, with several others like Grayscale’s GBTC and ETHE, Ark Invest’s ARKB and Fidelity’s FBTC seeing net outflows of over $100 million each.

Trading volumes for exchange-traded products increased slightly by 15% to $10 million, while broader cryptocurrency markets experienced reduced volumes.

Regionally, Canada and Switzerland bucked the trend with inflows of $43 million and $35 million, respectively. The United States, Germany, and Hong Kong faced outflows of $209 million, $8.3 million, and $7.3 million, respectively.

Also Read: Bitcoin ‘Not A Safe Haven’ But Rising Trump Odds Could Fuel A Rally: Standard Chartered

Why It Matters: The recent outflows in digital asset funds follow the announcement of Franklin Templeton, which filed for a new dual Bitcoin BTC/USD and Ethereum ETH/USD index fund with the SEC on Oct. 2.

If approved, the new Franklin Templeton Bitcoin and Ethereum Crypto Index ETF will be traded on the Chicago Board Options Exchange CBOE.

Ethereum ETFs have been underperforming their Bitcoin counterparts, as noted by BlackRock’s head of digital assets, Robert Mitchnick, on Oct. 1. He attributed this to Ethereum’s investment rationale being “a bit less easy for a lot of investors to digest” for investors but remains committed to “the education journey” with its institutional clients.

The developments come against a background of a strong September jobs report, dropping the chances of a second straight 50 bps rate cut in November to 0%, according to the CME Fedwatch tool.

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