Brief

Crypto Funds See $454M Outflows as Fed Rate-Cut Hopes Wane

Crypto investment products experienced $454 million in outflows last week, driven largely by Bitcoin and U.S. funds amid fading expectations for a Federal Reserve rate cut.

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Crypto exchange-traded products (ETPs) posted $454 million in net outflows last week, according to CoinShares, reversing part of the $1.5 billion inflows seen in the first two trading days of 2026. Analysts attributed the decline to diminishing investor expectations for a Federal Reserve interest rate cut in March, following recent US macroeconomic data. Month-to-date flows remained positive at $229 million, highlighting the volatility in early-year investor sentiment.

Bitcoin led withdrawals with $405 million in outflows, while short-BTC products saw minor exits of $9 million, indicating mixed sentiment toward the top cryptocurrency. Ether funds reported $116 million in outflows, and multi-asset altcoin products shed $21 million. Conversely, select altcoins, including XRP, Solana, and Sui, posted modest inflows of $46 million, $33 million, and $8 million, respectively, reflecting targeted investor interest in non-Bitcoin digital assets.

The US was the primary source of outflows, totaling $569 million, while European markets, including Germany, Canada, and Switzerland, posted combined inflows exceeding $100 million. Institutional flows were concentrated, with BlackRock’s iShares and Profunds Group leading inflows at $181 million and $180 million, respectively, while Fidelity and Grayscale saw significant redemptions of $454 million and $360 million. Crypto ETP assets under management ended the week at $181.9 billion, marginally above the prior week, indicating relative stability despite short-term outflows.

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