Crypto Funds Lose $454M as Fed Rate Cut Hopes Fade—Bitcoin Hit Hard

Digital asset funds saw $454 million in outflows last week, led by Bitcoin and Ethereum, as hopes for a Fed rate cut faded. The U.S. led withdrawals, while some altcoins like XRP and Solana attracted inflows.

Digital asset investment products experienced $454 million in net outflows last week, reversing early-year gains and marking one of the largest weekly withdrawals in recent months. The shift was driven by fading expectations for a Federal Reserve interest rate cut in March, following stronger-than-expected U.S. macroeconomic data. Bitcoin bore the brunt of the outflows, with $405 million withdrawn, while Ethereum products saw $116 million in redemptions. The United States led with $569 million in outflows, contrasting with inflows in Germany, Canada, and Switzerland. Despite the broader downturn, some altcoins such as XRP, Sui, and Solana attracted inflows, indicating selective investor confidence. The outflows occurred amid relative price stability for major cryptocurrencies, suggesting that factors beyond price movements, such as regulatory developments and macroeconomic concerns, influenced investor decisions. Multi-asset products and short-bitcoin funds also saw outflows, reflecting a broad cooling in sentiment across digital asset classes.