Bitcoin ETFs See Record Inflows as Investors Anticipate Rate Cuts

Cryptocurrency investors have significantly increased their purchases of Bitcoin-related exchange-traded products (ETPs) amid expectations of potential interest rate cuts in September. According to CoinShares, digital asset investment products saw $533 million in inflows from August 18 to August 24.

Bitcoin-related ETPs led the surge, with inflows totaling $543 million, marking the highest level of inflows in five weeks. BlackRock’s iShares Bitcoin Trust (IBIT) accounted for $318 million of this amount.

In contrast, Ether-related investment products experienced $36 million in outflows, primarily driven by a $118 million outflow from the Grayscale Ethereum Trust (ETHE). Despite this, new Ethereum ETFs have garnered $3.1 billion in inflows since their launch in July, though these gains were partially offset by Grayscale’s sell-offs.

The increased demand for Bitcoin ETPs coincided with an 8% rise in Bitcoin’s price, which climbed from $59,500 on August 18 to $64,300 on August 24. However, Bitcoin remains down 6% over the past 30 days, following a peak of $69,900 on July 29.

Analysts at Matrixport attribute the recent Bitcoin surge to robust stablecoin minting, particularly Tether, suggesting that institutional activity is driving the market more than macroeconomic factors.