Bitcoin and Ether exchange-traded funds saw significant outflows of $582 million and $159 million respectively, driven by renewed U.S. inflation fears and concerns over economic policies. This trend has coincided with a notable drop in cryptocurrency prices, particularly Bitcoin, which struggled to maintain a position above $100,000.

The recent outflow of funds from Bitcoin and Ether exchange-traded funds (ETFs) illustrates the mounting concerns surrounding the macroeconomic landscape. On a single day, Bitcoin ETFs experienced a stark withdrawal of $582 million, marking the second-highest net outflow recorded since their launch. Fidelity’s FBTC ETF led the depletions, with losses exceeding $258 million, while BlackRock’s IBIT also saw considerable withdrawals. At the same time, Ether ETFs lost approximately $159 million, reflecting a general trend of risk aversion among investors.

The root of this trend can be traced back to renewed inflation fears in the U.S., exacerbated by indications that the Federal Reserve may slow the pace of its policy easing. The Committee’s minutes from their recent meeting highlighted apprehensions about inflation in light of President Trump’s policies, which directly impacted investor sentiment and asset stability. Over a three-day span, the Bitcoin price experienced a significant drop of nearly 8.5%, failing to maintain its position above the crucial $100,000 mark.

The recent performance of Bitcoin and Ether ETFs underscores a significant shift in investor sentiment within the cryptocurrency market. Following a period of optimism that led to soaring prices, renewed fears regarding U.S. inflation and volatile bond markets have caused substantial outflows from ETFs. Such withdrawals are pivotal as they indicate a broader risk aversion among investors, often driven by macroeconomic factors. Analysts monitor these trends closely, particularly in light of key economic indicators such as nonfarm payrolls, which could reshape market expectations.

In summary, the substantial outflows experienced by both Bitcoin and Ether ETFs highlight growing investor apprehension related to inflation and macroeconomic volatility. The high withdrawal figures, coupled with significant price declines for cryptocurrencies, reflect a cautious environment in which investors are reevaluating their risk exposure. Nevertheless, some analysts express hope for a potential recovery following upcoming economic reports that may influence market directions.

Original Source: www.coindesk.com

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