Last week, the Federal Reserve decision to cut interest rates sparked a new wave of investment in digital asset funds, with Coinshares tracking a fresh inflow of $1.9 billion.
The policy shift, the 25 base cuts announced after the September FOMC meeting, gave investors a clearer signal that risk assets could benefit from easy financial positions.
James Butterfil, head of research at Coinshares, said market traders were the first to hesitate when interpreting the so-called “Hawkish Cut” as a mixed message. But when the market had time to adapt to this policy change, their feelings were turned over.
According to him:
“The inflow resumed later in the week and $746 million came in on Thursday and Friday as the market began to digest the impact of digital assets.”
He said the momentum has brought total assets under the control of Crypto Investment Products to $40.4 billion, the highest level ever recorded this year. With this in mind, he said 2025 could rival or outperform last year’s $48.6 billion tally if it continues its current pace.
Bitcoin controls
Bitcoin won a $977 million inflow last week, continuing its biggest draw. This was the third consecutive week of net profit as it overtook Ethereum as its priority allocation.
As a result, the BTC-focused fund has seen nearly $4 billion inflows this month, but has been around $24.7 billion since the start of the year. The funds manage assets worth $183 billion across a range of portfolios.
Meanwhile, the appetite for short Bitcoin products continues to decline, losing $3.5 million last week, slipping to its years lowest level of $83 million under control.
The situation of a short Bitcoin fund can be linked to an investor’s unwillingness to bets on Bitcoin. Because they believe that loose monetary policy will lean back into risk-on trading.
Altcoins will subtract $1 billion
Meanwhile, investors’ profits in Altcoin products were declared last week as this class of digital assets pulled out roughly $1 billion inflows.
Ethereum, the second largest cryptocurrency by market capitalization, led to the influx of these altcoins, drawing out fresh capital of $772 million.
This inflow totaled $12.6 billion year-on-year, sending assets under management of Ethereum products to a record $40.3 billion.
At the same time, small digital assets were attending the rally with a significant influx.
According to Coinshares, Solana products raised $127.3 million, while the XRP fund brought $69.4 million. Both assets currently clear the $1.5 billion mark in the 2025 inflow.
Cardano, Sui, Litecoin, and Chainlink have withdrawn about $6 million, reflecting the broader, lighter, and if any, broader range of investor profits.