Bitcoin Tops $61K Ahead of Jackson Hole as Ether ETFs Extend Record Outflow Streak

In the past six consecutive days, U.S.-listed Bitcoin exchange-traded funds (ETFs) have seen an accumulated investment of approximately $64 million. BlackRock’s IBIT saw the most inflows at around $75 million. Some market analysts view this steady increase in investments as potentially bearish, indicating a potential slowdown in the rate of new money flowing into these ETFs.

Conversely, Ethereum ETFs have been experiencing a six-day streak of withdrawals, marking a disappointing start for the products that follow the world’s second-largest cryptocurrency by market cap. On Thursday alone, these ETFs saw losses exceeding $800,000, pushing total outflows since their launch on July 23 to over $458 million.

Some investors are eagerly awaiting the comments made at the Jackson Hole meeting this coming Friday, as these may give hints about the Federal Reserve’s future monetary policy decisions. These decisions can affect the cost of various risky investments such as Bitcoin.

As a crypto investor, I observed that the recent downward adjustment in U.S. non-farm payrolls suggested a less robust labor market, potentially leading Fed officials to reconsider their plans for rate cuts. This uncertainty sparked a selloff among investors. However, my concerns were alleviated when the July FOMC minutes suggested that some policymakers might be open to reducing interest rates, indicating a more accommodative approach that considers both inflation control and employment objectives.

“Attention now turns to Fed Chair Powell’s Jackson Hole speech tomorrow for more rate-cut signals. With markets betting heavily on rate cuts, unexpected economic data can have a significant impact. We favor principal-protected products capturing topside gains,” QCP said.

According to reports, it’s anticipated that Powell will affirm a shift towards reduced lending rates next month. Historically, this move has boosted optimistic feelings among traders due to the stimulus it provides to sectors considered risky, as access to affordable capital often fuels growth in these areas.

Some are taking a cautious view, however.

As an analyst, I find that markets might experience some level of disenchantment as Powell may strive to maintain some flexibility regarding the four rate cuts already factored into the year-end forecasts. However, it’s worth noting that the Jackson Hole symposium has historically been a ‘risk-positive’ event. Consequently, traders might seize opportunities to buy during market dips.