The Impact of Interest Rate Cuts on the Crypto Market 321 Million Inflow

CoinDesk Report:
Source: Blockchain Knight
According to the latest weekly report from CoinShares, digital asset investment products saw capital inflows for the second consecutive week this month, with investors pouring $321 million into the industry.
This influx of investors has increased the total assets under management (AuM) of Crypto asset ETPs by 9%, reaching $85.8 billion. The total trading volume of investment products has also increased to approximately $9.5 billion.
James Butterfill, Research Director at CoinShares, linked this positive trend to the recent decision by the Federal Reserve to cut interest rates by 50 basis points.
He explained, “This surge is likely driven by the comments from the Federal Open Market Committee (FOMC) last Wednesday, where the committee took a more dovish stance than expected, including a 50 basis point interest rate cut.”
A breakdown of the fund flows shows that investment products based on BTC led the capital inflows, generating a net profit of $284 million globally last week.
It is worth noting that major Crypto asset funds from companies such as BlackRock, Bitwise, Fidelity, ProShares, and 21Shares contributed to this rebound, with a total net inflow of $321 million.
The positive price momentum of BTC also attracted investors betting against BTC, who put $5.1 million into short BTC funds.
Ethereum faced capital outflows for the fifth consecutive week, totaling $29 million. This trend is driven by the continuous withdrawal of funds from Grayscale’s ETHE product and declining interest in new products.
According to Farside’s data, the outflow of funds from ETHE ranged from $13 million to $18 million for three consecutive days last week, surpassing the slight inflows of other products, including Grayscale’s Mini Trust.
Meanwhile, Solana maintained its positive trend, with a capital inflow of $3.2 million last week. This inflow is also related to the recent announcement by several traditional financial institutions during the Solana Breakpoint event in Singapore that they plan to launch financial services on the network.
Other large-cap alternative assets, including XRP and LTC, saw a total inflow of $300,000.
In terms of regions, the United States unsurprisingly became the main contributor to capital inflows last week, accounting for $277 million, followed by Switzerland with $63 million.
In contrast, Germany, Sweden, and Canada saw outflows of $9.5 million, $7.8 million, and $2.3 million respectively.