Fed Rate Cut Ignites $1.9 Billion Crypto Influx: Bitcoin and Ethereum Lead Historic Rally

Digital assets erupt as monetary policy shift sends institutional capital flooding into crypto markets.

The Tidal Wave Begins

Bitcoin and Ethereum aren't just climbing—they're dragging the entire digital asset ecosystem upward on a $1.9 billion wave of fresh capital. The Federal Reserve's long-awaited rate cut finally materialized, and crypto markets responded with the kind of explosive momentum that leaves traditional finance scrambling to catch up.

Institutional Money Finds New Home

Wall Street's usual playbook looks increasingly outdated as smart money bypasses traditional channels and heads straight for digital infrastructure. The inflows represent more than just speculative betting—they signal a fundamental reassessment of crypto's role in diversified portfolios. While legacy systems grapple with bureaucratic inertia, blockchain networks process transactions and settle value with ruthless efficiency.

The New Financial Architecture Emerges

This isn't merely a rally—it's a redistribution of financial power happening in real-time. As traditional banks debate spreadsheets in committee meetings, decentralized protocols are quietly building the financial system of tomorrow. The $1.9 billion surge proves that when central banks blink, capital doesn't just move—it evolves. Maybe someone should tell the guys in suits that while they were worrying about basis points, the entire basis of finance changed.

• Digital asset funds saw $1.9 billion in weekly inflows, led by Bitcoin and Ethereum.
• Binance Bitcoin Open Interest rose 4.7% after the Fed’s rate cut, showing renewed risk appetite.
• Altcoin rotation is fading, with market focus shifting back to Bitcoin and Ethereum.

Digital asset investment products recorded a second straight week of inflows, with $1.9 billion entering the market, according to CoinShares.

The MOVE followed the US Federal Reserve’s 25 basis point rate cut last week. Investors initially reacted cautiously to what was described as a “hawkish cut,” but by Thursday and Friday, inflows accelerated, reaching $746 million in just two days.

Total assets under management climbed to $40.4 billion, the highest level this year and moving closer to last year’s peak of $48.6 billion. The United States accounted for the bulk of flows, with $1.8 billion, while Germany added $51.6 million, Switzerland $47.3 million, and Brazil $9.3 million. Hong Kong, however, reported small outflows of $3.1 million, showing mixed sentiment across regions.

Bitcoin, Ethereum Lead Market Recovery

Bitcoin remained the primary driver, attracting $977 million in inflows last week. Meanwhile, Short-Bitcoin products continued to lose ground, losing $3.5 million in outflow and reducing their assets under management to $83 million, the lowest in years.

Ethereum also gained sharp interest, attracting $772 million, and bringing its inflows this year to $12.6 billion. This sent Ethereum’s assets under management to an all-time high of $40.3 billion.

Other noteworthy inflows were also observed in Solana at $127.3 million and XRP at $69.4 million, showing that altcoins still had support in spite of BTC and ethereum dominating the week’s action.

Meanwhile, Binance data from CryptoQuant showed BTC open interest ROSE 4.7% after the ruling was made by the Fed. Open interest before the ruling was $12.8 billion on Binance.

24 hours later, it was at $13.4 billion. Since Binance is the largest exchange in terms of having $44 billion in open interest, this type of spike is an indication of favorable institutional positioning.

Altcoin Rotation Slows Down

Inflows indicate new confidence, and trading flows indicate shifting momentum. Bitcoin has traded sideways in recent months, and this has sent trading to Ethereum and other altcoins.

This rotation has been slowing down as trading volumes’ dominance has been weakening from Ethereum, and withdrawal signs have been increasing.

Analysts note today’s long rotation has reached an end, and Bitcoin is in a tight range. The cut down by the Fed in due course can bring an impetus to a whole move, but at present, caution dominates.

The inflows have returned, and open interest also climbs, and Bitcoin’s future trend can be established in the weeks to come.