Recently, the Federal Reserve’s choice to lower interest rates triggered a surge of investment into digital asset funds, with CoinShares recording $1.9 billion in new inflows.
This policy change, involving a 25 basis-point decrease announced following the September FOMC meeting, offered investors a clearer indication that risk assets could gain from more favorable financial conditions.
James Butterfill, head of research at CoinShares, observed that market traders were initially cautious, interpreting the so-called “hawkish cut” as a mixed signal. However, their outlook shifted as markets adjusted to this new policy.
According to him:
“Inflows resumed later in the week, with $746 million entering on Thursday and Friday as markets began to absorb the implications for digital assets.”
He mentioned that this momentum pushed total assets under management in crypto investment products up to $40.4 billion, the highest recorded this year. Given this trend, he suggested that 2025 could match or exceed last year’s $48.6 billion figure if the current momentum holds.
Bitcoin leads
Bitcoin continued to be the main attraction, drawing in $977 million in inflows last week. This marked the third week in a row of net gains since eclipsing Ethereum as the favored investment.
This led BTC-focused funds to accumulate nearly $4 billion in inflows this month, with year-to-date totals reaching $24.7 billion. These funds now oversee over $183 billion in assets across their portfolios.
Conversely, interest in short-Bitcoin products has declined, with these funds losing $3.5 million last week, dropping to a multi-year low of $83 million in assets under management.
The situation for short Bitcoin funds can be attributed to investors’ hesitance to bet against Bitcoin, believing that the loose monetary policy favors risk-on strategies.
Altcoins attract $1 billion
Simultaneously, investor enthusiasm for altcoin products was evident last week, as this category of digital assets attracted approximately $1 billion in inflows.
Ethereum, the second-largest crypto asset by market capitalization, spearheaded inflows for these altcoins, securing $772 million in new capital.
This influx boosted its year-to-date total to $12.6 billion and pushed assets managed in Ethereum products to a record $40.3 billion.
At the same time, smaller digital assets contributed to the upward trend with noteworthy inflows.
CoinShares reported that Solana products attracted $127.3 million, while XRP funds saw inflows of $69.4 million. Both assets have now surpassed the $1.5 billion mark for inflows in 2025.
Cardano, Sui, Litecoin, and Chainlink collectively drew around $6 million, revealing a broader, though less intense, interest from investors.
