US Bitcoin and Ethereum Investors Prep for FOMC Meeting

The Federal Reserve of the United States is set to convene on September 18 and 19 to deliberate whether to follow the lead of other central banks, like the ECB, in reducing key interest rates after a prolonged period of increases.

This event holds particular significance for all financial markets, with a notable emphasis on the crypto sector due to its relatively brief existence and vulnerability to similar news and events. Therefore, it is noteworthy to examine the steps US investors have taken to prepare, especially regarding their ETF investments in Bitcoin and Ethereum.

Bitcoin Purchases

Since their launch in mid-January this year, the 11 spot Bitcoin ETFs have reflected the prevailing sentiment among US investors towards the leading cryptocurrency. Their trading activities have also affected the price fluctuations of the underlying asset, as extended buying trends have resulted in price rallies and vice versa.

Their investment strategies are greatly influenced by market developments and the broader economic climate. For instance, they exhibited a short-term buying surge on August 23 and 26 (Friday and Monday) following Jerome Powell’s statement hinting at potential interest rate cuts by the US central bank.

Despite a shift in their behavior over the next couple of weeks due to economic instability, they resumed accumulating in the last few days. FarSide data indicates that the total net inflows for all spot BTC ETFs in the US reached $186.8 million on Tuesday, marking the last full trading day before the FOMC meeting.

In previous days, the positive inflow figures were $12.8 million on Monday, a striking $263.2 million last Friday, and $39 million the Thursday before. This suggests that US-based investors have augmented their BTC ETF holdings by slightly over $500 million in just four trading days.

What About ETH?

The spot Ethereum ETFs have not garnered significant interest or demand from investors, as previously mentioned. This trend remained relatively consistent this week, with total outflows of $9.4 million on Monday and $15.1 million yesterday.

This indicates that even optimistic news for riskier assets, like the anticipated rate cut by the Fed, failed to shift investors’ viewpoints regarding the Ethereum ETFs.