Crypto outflows reached $415 million last week, a stark reversal from the positive flows seen since the beginning of the year. The downturn is attributed to Federal Reserve Chair Jerome Powell's hawkish remarks and higher-than-expected US inflation data. Bitcoin, known for its sensitivity to interest rate expectations, experienced the brunt of the investor retreat, reflecting a broader risk-off sentiment in the crypto market. The outflows were largely driven by US investors reacting to domestic economic signals. This marks the first net withdrawal from digital asset investment products in 2021, disrupting a streak of positive flows. The impact of inflation data and Powell's stance on rate cuts was more evident in Bitcoin ETF outflows compared to Ethereum ETFs. This shift in investor sentiment highlights how economic data and policy signals can swiftly affect the crypto market. The minutes of the FOMC meeting later in the week may impact crypto inflows or outflows.



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