Last week, Bitcoin and Ethereum exchange-traded funds (ETFs) collectively attracted nearly $3 billion in fresh capital, signaling a robust resurgence in investor interest. This influx comes on the heels of a tumultuous August characterized by fluctuating market activity. According to data from SoSoValue, Bitcoin ETFs experienced five consecutive days of inflows, while Ethereum products recorded four straight days of gains.
Bitcoin emerged as the primary driver, amassing approximately $2.4 billion in net inflows, whereas Ethereum ETFs attracted around $640 million. The total inflows underscore a growing appetite for cryptocurrencies among investors, fueled largely by increasing expectations of interest rate cuts from the Federal Reserve.
Predictions for forthcoming monetary policy adjustments have dramatically shifted market sentiments, with the probability of a rate cut at the next Federal Open Market Committee (FOMC) meeting estimated at nearly 94%. Influential institutions, including Coinbase and Morgan Stanley, foresee continued easing of rates through the year’s end. The prospect of lower interest rates typically serves as a catalyst for riskier assets, particularly within the crypto realm, where liquidity and momentum are critical.
The effects of potential policy changes are already manifesting, with Bitcoin recently reaching a three-week high of over $116,000, breaking away from its previous tight correlation to the Nasdaq Composite. Market analysts believe that the influx of institutional capital, particularly through ETFs, could significantly amplify Bitcoin’s next price rally.
Sean Dawson from Derive has forecasted Bitcoin could soar to $140,000 by year-end, with even more optimistic projections suggesting a rise to $250,000 if the trends in inflows continue. Fundstrat’s Tom Lee echoed this sentiment, stating that Bitcoin “can easily get to $200,000” before the year concludes.
Simultaneously, Ethereum has been demonstrating significant performance, boasting nearly 200% gains since mid-April, in stark contrast to Bitcoin’s approximate 50% increase during the same timeframe. While attention has largely centered on Bitcoin, analysts highlight several underlying factors that position Ethereum for long-term success.
Samir Kerbage, CIO at Hashdex, emphasized that “Ethereum is waking from its slumber,” projecting a potential price trajectory toward $10,000. This prediction is based on three key catalysts: an increasing focus on staking, the burgeoning landscape of tokenized assets, and an anticipated generational wealth transfer that favors cryptocurrency adoption.
In terms of recent movements, Bitcoin experienced a slight uptick of 0.4% over the past 24 hours, trading at $115,720, while Ethereum climbed by 1.9%, reaching $4,635. The excitement surrounding these assets suggests that the crypto market may be gearing up for a substantial shift as it continues to navigate the broader economic landscape.
