Bitcoin is navigating competing forces as fresh exchange-traded fund demand collides with growing expectations for tighter U.S. monetary policy. The cryptocurrency is holding above $77,100 after a volatile week that saw it briefly cross $81,500 before retreating on Federal Reserve commentary.
Bitcoin reached $80,256 on August 27, its highest level since May, but pulled back after Federal Reserve Chair Kevin Warsh's Jackson Hole remarks shifted market expectations. The comments raised the implied probability of a September rate increase from the mid-30% range to approximately 60%, prompting a reassessment of monetary policy outlook.
Despite the pullback, Bitcoin closed Friday only about 3% lower and remained above previous range highs through the weekend. Analysts identified $77,100 as a significant volume-node support level that helped define the cryptocurrency's August breakout.
ETF Inflows Provide Support
U.S. spot Bitcoin ETFs recorded $924.5 million in net inflows last week despite $202 million in outflows on Friday. The funds attracted $3.04 billion during the prior nine sessions, indicating continued investor demand amid the shifting rate environment.
Derivatives Market Remains Controlled
Bitcoin's derivatives markets have remained relatively stable during the rally. Perpetual futures open interest reached $55.6 billion, approximately 20% above early August levels, while funding rates and futures basis remained contained.
On-chain data shows a shift in Bitcoin ownership patterns. Wallets holding 1,000 to 10,000 BTC have reduced their balances by about 50,500 BTC since late June, while exchange and ETF custodial wallets have added roughly 59,100 BTC.
