Bitcoin ETF Inflows Surge by $15B as Trump Turns Up Heat on Fed, Prompting Bullish Positioning

Bitcoin ETF Inflows Swell to $15B as Trump’s Fed Criticism Fuels Bullish Bets

Spot Bitcoin ETFs in the U.S. have seen significant inflows over the past three months, driven in part by growing political pressure on the Federal Reserve to cut interest rates.

These steady investments are pushing previously cautious traders back into the market, sparking renewed bullish sentiment for Bitcoin, according to Markus Thielen, founder of 10x Research.

“The sharp rise in bitcoin ETF inflows since late April has largely been fueled by political pressure on the Fed,” Thielen noted in a client report Thursday. “Donald Trump has openly demanded Jerome Powell cut rates to 1% and resign. Initially a partisan narrative, it has now broadened, with figures like FHFA director Bill Pulte and Senator Cynthia Lummis also calling for Powell’s removal over his hawkish stance.”

Trump’s repeated criticism of the Fed has drawn comparisons to Recep Tayyip Erdogan’s approach in Turkey between 2019 and 2021, when Erdogan ousted central bank officials who resisted lowering rates—a move that triggered a collapse in the Turkish lira and an exodus of foreign capital.

Trump argues that Powell’s reluctance to cut rates has cost the U.S. economy billions. Meanwhile, minutes from the Fed’s July 17–18 meeting show a divided central bank, with some officials supporting rate cuts as early as this month and others preferring to keep rates steady, CNBC reported.

Traders Rush Into Bullish Positions

As political drama unfolds, traders are scrambling to increase their exposure to Bitcoin.

“Bitcoin ETFs have absorbed $15 billion in inflows since mid-April,” Thielen said. “This buying has been relentless, despite bitcoin consolidating since mid-May. Under-positioned traders seem to be chasing the market, as derivatives data points to renewed bullish positioning.”

Many traders are snapping up call options with strike prices at $130,000, signaling expectations that bitcoin could soon break higher. Call options reflect bullish bets, as they gain value if prices climb.

This surge in bullish sentiment lines up with bitcoin’s historical performance in July. Data from Coinglass shows bitcoin has logged gains in eight of the past twelve Julys, averaging over 7% monthly returns.

“Layer in the typically strong seasonality in July, plus potential bullish macro triggers in coming data releases and policy decisions, and the setup for further gains is solid,” Thielen added.

Bitcoin recently touched record levels, trading just under $112,000 on several exchanges late Wednesday, according to CoinDesk data.