Crypto investors await the Fed’s next move

According to research released on Monday, investors are now more hopeful about the market for digital assets and are investing more money than they did in the past in cryptocurrency funds.

Fund inflows totaled $76 million last week, marking the fourth straight week of such moves. The capital is moving into funds like Grayscale, 3iQ, and 21 Shares, which are offered to accredited investors.

The end of last year and the beginning of 2023 were different from this because investors were withdrawing funds from exchange-traded products and other similar crypto investment vehicles, mostly because of a painful bear market that was made worse by the collapse of the exchange FTX in November.

The data indicates that there has been a “divisive change in investor emotions from the beginning of 2023.”

The amount of investment assets under administration as a whole has increased 39% from this time last year to $30.3 billion, which is the highest in August since 2022.

In its study, the company also stated that investors are mostly focused on the largest digital asset: Bitcoin remains the main investment focus, with inflows totaling US$69 million, or 90% of the overall flows for the week.

3/ Total investment assets under management (AuM) are at their highest level since mid-August 2022, having increased 39% year to date to US$30.3 billion.

According to James Butterfill, head of research at CoinShares, the key reasons for the better sentiment are the softening monetary policy stance from the U.S. and the sinking dollar.

Last year, the U.S. Federal Reserve aggressively raised interest rates in an effort to control inflation, which had reached a 40-year high. Even if it has slowed down, the central bank is still rising interest rates. The Fed increased interest rates by 75 basis points four times last year, but only by 50 basis points in December and then by 25 basis points just last week.

Investors are now anticipating with great interest the speech that Federal Reserve Chairman Jerome Powell will deliver tomorrow at the Economic Club of Washington, D.C.

The largest digital asset by market size is currently trading for $23,000, a 0.3% 24-hour decline. U.S. equities are down today, and Bitcoin and other cryptocurrencies have followed.

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