Between Donald Trump and the Federal Reserve, cryptocurrency funds came under major attack last week.

Digital asset investment products, including instant transactions Bitcoin and Ethereum ETFs combined saw inflows of $48 million just last week, according to Currency stocks. Bitcoin products ended the week with net inflows of $214 million, while Ethereum products lost $255 million.

Investors started the week with $1 billion in crypto allocations, but the strong start to the new year was quickly overshadowed by overall anxiety. Strong minutes from the Federal Reserve's latest meeting and strong readings on the US economy led investors to withdraw $940 million from digital asset investment products - effectively canceling out initial inflows.

“This suggests that the post-US election honeymoon is over, and that macroeconomic data is once again becoming a major driver of asset prices,” wrote James Butterville, head of research at CoinShares.

Last week, minutes from the Fed's meeting showed that policymakers are looking at the potential Shifts in immigration and trade policies Under President-elect Donald Trump as a source of inflationary pressures. In December, they also indicated they would cut interest rates at a slower pace this year.

Cryptocurrency stocks and assets tend to thrive in low interest rate environments, with cheaper borrowing and greater liquidity. But amid a series of reports showing that the US economy remains strong, some analysts say so The Fed's easing campaign has effectively ended.

Butterville said that in addition to the recent strength witnessed in the American economy Decryption Bitcoin price growth is limited from a macro perspective, while “the market appears to be in a state of negative chaos.”

“Any bullish momentum for Bitcoin will likely stem from the approval of Bitcoin-related legislation after (Trump’s inauguration) or some major misstep,” he said.

Over the past week, the price of Bitcoin has fallen by 10% to... $91,600To touch its lowest price in two months. Meanwhile, the price of Ethereum fell by 18% to $3000while XRP remained relatively constant at $2.43.

With XRP products taking in $41 million, Butterfill wrote that the altcoin is seeing “increasing optimism” ahead of its approval deadline. XRP ETFs In the US later this month. Former Bloomberg ETF Analyst James Seyphart books The requests are unlikely to be taken seriously until the agency's leadership is changed under Trump.

In 2024, investors allocated $42.9 billion to Ethereum and Bitcoin products, accumulating cash in tandem. The emergence of spot ETFs For US cryptocurrencies in 2025, Bitcoin products have generated $797 million, while Ethereum products have lost $274 million so far.

Although diminishing prospects for a Fed rate cut is a net negative for the cryptocurrency market, inflows could pick up again soon, said Juan Leon, chief investment strategist at Bitwise. Decryption.

In the United States, spot bitcoin ETFs have undergone due diligence processes between registered investment advisors and money transfer offices, Leon said. As financial companies work through the approval process, inflows could accelerate, as governments and corporations are likely to purchase Bitcoin as well.

“This will cause the price of Bitcoin to rise,” Leon said. “We expect inflows into spot bitcoin ETFs to be larger this year compared to last year.”

Modified by Andrew Hayward