US Bitcoin ETFs Lost $946 Million After Hawkish Tone From Fed

U.S. Bitcoin exchange-traded funds took the brunt of outflows from institutional investors last week, recording withdrawals worth $946 million, according to a new report from digital asset management firm CoinShares.

ishares Bitcoin Trust (IBIT) lost about $400 million last week, the most of the 11 spot BTC funds currently trading. However, total net outflows for all funds tracking digital assets were a less dramatic $360 million.

“Despite the recent U.S. interest rate cuts, digital asset investment products saw a total outflow of $360 million last week, as investors interpreted Federal Reserve Chairman Jerome Powell’s comments about the possibility of further interest rate cuts in December as ‘not a foreseeable conclusion,’” James Butterfill, research director at CoinShares, said in a report. “This hawkish tone, combined with the notable lack of release of key U.S. economic data, appears to be leaving investors at a loss.”

The BTC fund’s losses were offset by gains in other regional ETFs. Net inflows from German and Swiss issuers exceeded $30 million last week. Canadian and Australian issuers generated inflows worth $8.5 million and $7.2 million.

The entire crypto fund category boomed with higher-than-normal inflows into Solana exchange-traded products. Investors poured $421 million into the SOL-based ETF last week following hype for the new U.S.-based fund, which began trading in late October.

Last week’s debut stocks included the Bitwise Solana ETF, which trades on the Nasdaq under the ticker BSOL. The fund has already managed $105 million worth of assets since its launch a week ago. The competing Lex Osprey Solana Staking ETF, which also trades on the Nasdaq under the ticker SSK, took 12 business days to reach $100 million in assets under management.

The lack of U.S. economic data is due to the U.S. government shutdown, which has continued for more than 33 days. By Wednesday this week, the shutdown will be the longest in U.S. history. Users of Prediction Markets Owned by Myriad decryption Parent company Dastan believes there is a 97% chance that lawmakers will not lift the shutdown within the next two days.

Cryptocurrency markets plummeted on Monday morning, forcing the liquidation of more than $1 billion worth of crypto contracts. Bitcoin and Ethereum were roughly tied, accounting for $312 million and $303 million worth of contracts, respectively.

At the time of writing, Bitcoin was trading at $107,463 after falling 2.5% over the past day. And Ethereum was trading at $3,657.77, about 5.1% lower than this point on Sunday, according to crypto price aggregator CoinGecko.