TLDR
- Bitcoin ETFs saw $15.85 million in net inflows, breaking a two-week outflow streak
- Trump threatened to fire Fed Chair Powell after his comments on tariffs and inflation
- Bitcoin rallied to over $87,600, up 16% since April 9
- Ethereum ETFs continued to struggle with $32.17 million in outflows
- Powell has maintained he cannot be fired and that Fed independence is protected
Bitcoin ETF Flows Turn Positive Amid Fed Chair Controversy
Bitcoin ETFs in the United States recorded positive weekly inflows for the first time in three weeks as Bitcoin’s price climbed past $85,000. The rise comes as tensions escalate between President Donald Trump and Federal Reserve Chair Jerome Powell over monetary policy and tariffs.
Data from SoSoValue shows that 12 spot Bitcoin ETFs brought in $15.85 million in net inflows last week. This ends a two-week streak of outflows that saw $886 million exit the funds.
The daily flow pattern was mixed. Monday saw modest inflows of $1.47 million, followed by stronger inflows of $76.42 million on Tuesday. Wednesday marked a sharp reversal with $169.87 million in outflows, but sentiment improved again on Thursday with $107.83 million flowing back in.
BlackRock’s IBIT led the inflows with $186.5 million, while Bitwise’s BITB attracted $23.8 million according to Farside data. Several other ETFs including Grayscale’s mini BTC Trust, Invesco’s BTCO, Franklin’s EZBC, and VanEck’s HODL contributed a combined $26.3 million in inflows.
However, not all funds saw positive flows. Fidelity’s FBTC experienced outflows of $174.9 million, and ARK’s ARKB lost $99.8 million, offsetting much of the week’s gains.
Trump-Powell Tension Drives Market Volatility
The market turbulence was largely triggered by an escalating conflict between President Trump and Fed Chair Powell. On April 16, Powell spoke in Chicago warning that Trump’s tariff measures on major trading partners could increase inflation and harm employment.
This speech appeared to spark Wednesday’s large outflows from Bitcoin ETFs. The situation shifted dramatically on Thursday after Trump declared that Powell’s “termination can’t come fast enough” in a social media post.
Reports also emerged that Trump might replace Powell with Kevin Warsh, a former Fed official with pro-cryptocurrency views. This news helped drive Bitcoin’s recovery in the latter part of the week.
Trump appointed Powell in 2017 but has frequently criticized his decisions regarding interest rates. The president’s latest threat raises questions about the independence of the Federal Reserve, which has been a cornerstone of U.S. monetary policy.
Fed Independence Concerns Grow
Chicago Fed President Austan Goolsbee expressed concern about the potential impact of removing Powell. “I strongly hope that we do not move ourselves into an environment where monetary independence is questioned,” Goolsbee told CBS’s “Face the Nation” on Sunday.
Goolsbee warned that undermining Fed independence would damage the central bank’s credibility. He noted there is “virtual unanimity” among economists that central banks should operate independently from political interference.
Powell has stated he would not resign if asked by the president. “Generally speaking, Fed independence is very widely understood and supported in Washington, in Congress, where it really matters,” Powell said at the Economic Club of Chicago.
Legal experts debate whether Trump has the authority to remove Powell. A Supreme Court precedent from the Roosevelt era suggests the president cannot remove heads of independent agencies without cause such as neglect or wrongdoing.
Some financial experts caution that Fed independence may be more of a norm than a firmly established law. Itay Goldstein, finance department chair at the University of Pennsylvania’s Wharton School, told Fortune: “Laws also depend on people and who they are, how they interpret things, and what they’re willing to do.”
Bitcoin has been recovering since the news broke and reached over $87,600 early Monday, its highest level since Trump announced his “Liberation Day” tariffs. The cryptocurrency has gained more than 16% since bottoming near $75,000 on April 9.
Bitcoin’s rise parallels gold’s recent performance. Both assets are benefiting from the weakening U.S. dollar and growing economic uncertainty. The U.S. Dollar Index has dropped 10% this year amid escalating global trade tensions.
Analysts at Geiger Capital suggested in an April 21 post that Bitcoin may be starting to “decouple” from traditional markets. They identified a breakout from a falling wedge pattern that often signals sustained gains ahead.
– Tech futures down
– Dollar down
– Gold new ATH
– Bitcoin breaking out/decouplingRealize where we are. pic.twitter.com/XqZRlEHj39
— Geiger Capital (@Geiger_Capital) April 21, 2025
Meanwhile, Ethereum ETFs continue to struggle with $32.17 million in outflows last week. This marks the eighth consecutive week of losses, with nearly $910 million exiting these funds to date.
Stay Ahead of the Market with Benzinga Pro!
Want to trade like a pro? Benzinga Pro gives you the edge you need in today's fast-paced markets. Get real-time news, exclusive insights, and powerful tools trusted by professional traders:
- Breaking market-moving stories before they hit mainstream media
- Live audio squawk for hands-free market updates
- Advanced stock scanner to spot promising trades
- Expert trade ideas and on-demand support
