Bitcoin ETFs Bleed $342M After Fed Halts 15-Day Streak

Key Points:

• Bitcoin ETFs see sharp $342M outflow as Powell confirms rate cuts are not coming soon.
• Fidelity and Grayscale funds lead withdrawals, reversing $4B inflow streak over the last 15 days.
• Ethereum ETFs gain momentum, with $54M into BlackRock’s ETHA amid shifting investor sentiment.

Bitcoin exchange-traded funds saw a sharp reversal on Tuesday, registering $342.2 million in net outflows. The movement ended a 15-day streak of inflows that had brought over $4 billion into the market. 

According to Farside Investors, Fidelity’s FBTC fund recorded the largest outflow, with $172.7 million leaving the fund. Grayscale’s GBTC followed, seeing $119.5 million in redemptions.

The outflows followed comments by Federal Reserve Chair Jerome Powell that signaled no near-term rate cuts. His statements at the European Central Bank forum pointed to a continuation of the Fed’s restrictive monetary policy stance, which investors took as a sign to reduce risk exposure.

Powell Links Tariffs to Delay in Rate Cuts

During the ECB event in Portugal, Powell responded to questions about whether rate cuts would have already occurred in 2025 if not for the effects of President Donald Trump’s trade policies. Powell stated, 

“I think that’s right.”

He added that the size of the tariffs caused all inflation forecasts for the U.S. to rise sharply, forcing the Fed to pause.

The central bank has held rates steady since Trump returned to office, even as the president continued to push for easing. Trump recently criticized Powell publicly, but the Fed Chair has maintained that reducing rates too early could fuel inflation again.

Ethereum ETFs Continue to Attract Inflows

While Bitcoin ETFs faced losses, spot Ethereum ETFs recorded $40.7 million in net inflows on the same day. BlackRock’s ETHA fund led the group, pulling in $54.8 million. This marked the third straight day of net inflows for Ethereum ETFs, bringing their three-day total to $150 million.

Since launching in July 2024, spot Ethereum ETFs have attracted $4.3 billion in net inflows. The inflow trend for Ethereum stands in contrast to Bitcoin’s pullback, as investor interest appears to be rotating toward alternative assets.

Meanwhile, the recent developments show investor sensitivity to macroeconomic signals, especially around interest rates and monetary policy.