Crypto Inflows Reached $3.4 Billion Last Week

The latest CoinShares report indicates that crypto inflows reached $3.4 billion last week, reversing a three-week negative flow trend.

Cryptocurrency inflows set another benchmark last week, reaching their third-highest levels on record as trade chaos and its knock-on effects on the US dollar continue to rattle markets.

The latest data from digital asset management firm CoinShares indicates that crypto outflows reached $146 million in the week prior. Two successive weeks before that recorded crypto outflows of $795 million and $240 million, respectively.

However, the latest figures show a reversal of the sustained three-week trend, with crypto outflows reaching $3.4 billion.

This marks the third-highest reading on record and follows a sustained period of outflows that began in March.

"We believe that concerns over the tariff impact on cooperate earnings and the dramatic weakening of the US dollar saw investors return to digital assets in a significant way," said James Butterfill, Head of Research at CoinShares.

According to Butterfill, investors are increasingly viewing crypto as an emerging safe haven beyond Bitcoin.

Despite this, given its helm as the largest crypto by market cap metrics, Bitcoin investment products were the main beneficiaries, recording $3.188 billion of inflows.

Out of the other altcoins, XRP bucked the trend last week. This aligns with the growing sentiment that the approval of ProShares’ XRP futures ETF (exchange-traded funds) is fueling optimism.

As BeInCrypto reported, predictions suggest that a spot XRP ETF could follow, potentially attracting $100 billion to Ripple’s payments token.

"A spot XRP ETF could be next, unlocking real demand and sending prices soaring. $100 billion+ could soon flood into Ripple token," analyst Armando Pantoja wrote.

Tariffs Weigh Heavily on US Dollar and Corporate Earnings

Earlier this week, President Donald Trump announced new tariffs on Chinese goods, set to begin on September 1.

The latest round of tariffs will affect a wide range of products, including food and seafood.

The move comes amid escalating trade tensions between the two economic superpowers.

This latest development has sparked concerns among economists and market analysts.

Tariffs are essentially taxes that are imposed on imported goods. In this case, US consumers will ultimately bear the brunt of the tariffs.

The tariffs will likely lead to price increases for a variety of products, putting pressure on household budgets and impacting consumer spending.

Moreover, the tariffs could disrupt supply chains and lead to shortages of goods that are typically sourced from China.

This, in turn, could pose challenges for businesses and may result in layoffs or reduced investment.

The tariffs are also expected to have a significant impact on the US dollar.

As the US is running a trade deficit with China, the tariffs are expected to weaken the dollar.

This is because the tariffs will reduce the demand for Chinese goods, which could lead to a depreciation of the yuan relative to the dollar.

In response to the tariffs, the yuan is expected to depreciate to try to maintain the competitiveness of Chinese exports.

However, to maintain the parity between the yuan and the dollar, the Chinese central bank will need to sell yuan and buy dollars in the foreign exchange market.

This action will decrease the demand for yuan and increase the demand for dollars, ultimately leading to a depreciation of the dollar.

At the same time, the lack of action by the Federal Open Market Committee (FOMC) on further interest rate cuts and the significant downward revisions to its 2025 economic projections suggest weaker growth and persistent inflation.

The combination of Trump’s political pressure on the Federal Reserve (Fed) to cut rates and the FOMC's decision not to do so highlights a potential battle over monetary policy.