The ETP Market Regains Momentum Thanks to Bitcoin

The charts turn green, traders are smiling again, and the crypto market wakes up from a prolonged blues. The momentum accelerates and assets under management explode. In one week, crypto exchange-traded products (ETPs) saw a flood of capital. And this boost is no coincidence. A well-oriented inflation index in the United States has rekindled appetite for bitcoin, and with it the entire market.

Bitcoin Leads the Dance After the CPI

With $931 million in net inflows in one week, bitcoin has regained control of the ETP market . This spectacular rebound comes after $513 million in outflows the preceding week. Behind this reversal lies good news: US inflation rose 0.3% in September, bringing the annual rate down to 3%, below market expectations.

Crypto ETP flows by asset as of Friday (in millions of US dollars). Source: CoinShares

This surprise has given wings back to institutional investors who again anticipate an interest rate cut. According to James Butterfill, Head of Research at CoinShares:

The current paralysis of the US government, and the lack of key macroeconomic data resulting from it, have left investors without clear guidance on the direction of US monetary policy. However, Friday’s release of inflation (CPI) data below expectations has helped revive confidence in further rate cuts this year.

The United States recorded $843 million in inflows, while Germany surprised with $502 million. Switzerland, on the other hand, showed outflows of $359 million, due to transfers rather than liquidations. In sum, confidence is returning, especially around BTC.

Altcoins Slow Down, but the Crypto Market Holds On

While bitcoin takes off, other cryptos are pausing. Ether, for instance, lost $169 million , breaking a five-week streak of positive inflows. However, x2 leveraged ETPs on ETH remain popular. Solana, after strong momentum, now attracts only $29.4 million, down 81%. As for XRP, its $84.3 million inflows mask a clear slowdown ahead of anticipated US crypto ETF launches.

What does this tell us? A more selective crypto market, focused on BTC’s strength. CoinShares confirms this in its report:

Despite this, x2 leveraged ETPs remain popular. Flows into Solana and XRP have slowed ahead of US ETF launches, with $29.4 million and $84.3 million respectively. 

Some Notable Figures

• $931M: net inflows into Bitcoin ETPs last week;
• $115,654: current price of bitcoin , a new symbolic level for traders;
• $9.4 billion: cumulative inflows since the Fed began cutting rates;
• $30.2 billion: total invested in Bitcoin ETPs in 2024 (still below $41.6 billion in 2023);
• $229 billion: total crypto assets under management in ETPs, all assets combined.

The tide is also turning for derivatives. While ETPs attract capital, the bitcoin options market explodes . Traders are injecting $63 billion, a record level. Proof that the crypto industry, fueled by macro trends, has not yet said its last word.