Bitcoin ETF outflows continue as Powell’s rejection of rate cuts and high inflation trigger a pullback from institutional investors. However, the Ethereum ETF market performed well, showing strong confidence and investor appetite for buying the dip.

It may be alluring to suggest that high inflation will decrease investment across the entire crypto market, but other factors can overcome this bearish headwind.

Bitcoin ETFs Feel the Inflation

Since the SEC first approved Bitcoin ETFs in 2024, they’ve heralded a wave of integration between the crypto industry and traditional finance. In some ways, crypto has benefitted greatly, with BlackRock’s IBIT counting as one of the most successful ETFs ever. This market entanglement, however, can sometimes have a negative impact, as shown by recent outflows:

Yesterday, the Bitcoin ETF market saw $56.76 million in outflows, with $243 million in total outflows this week. This may seem surprising at first, considering that these funds were headed toward a dramatic recovery less than a month ago.

However, the BTC ETFs saw their first week of net outflows in 2025 last week, and outflows have since continued.

A few factors in the broader market help explain this phenomenon. Top-level analysts have predicted that US inflation and economic policies will have an outsized role on the crypto market, and that prediction is coming true. Yesterday, Jerome Powell rejected President Trump’s plan to use rate cuts to reduce inflation.

Powell’s decision does have a few positive factors for crypto, but in the short term, it’s making investors very skittish. US inflation climbed to 3% YoY this morning, causing capital to pull back from Bitcoin and its ETF market.

However, these factors have not halted the momentum of Ethereum ETFs, as they saw inflows of $12.58 million yesterday.

Perversely, this ETF category is actually gaining from its asset’s underlying woes, in contrast with Bitcoin. Last week, these products saw a huge rush in trading volume as investors sought to buy the dip. Since then, Ethereum has stayed low, pushing ETF inflows to a two-month high.

In short, inflation and other broad market factors have triggered a brief pullback for Bitcoin ETFs, but they aren’t the only factors in play. For Ethereum, there seems to be a strong short-term confidence.

The upcoming Pectra upgrade in March and recent purchases from Donald Trump-backed World Liberty Financial have driven institutional interest in the largest altcoin. So, the US spot Ethereum ETF market might continue to see net inflows as long as ETH is below $3,000.

Dogecoin’s price has shown little momentum recently, holding around $0.25, with no clear direction emerging. This uncertainty has extended into the futures market, where traders are unsure of the coin’s next move. 

However, long-term holders (LTHs) are exhibiting resilience, continuing to HODL their positions and providing some support for recovery.  

Dogecoin Is Facing Uncertainity

The Mean Coin Age (MCA) indicator is showing a noticeable uptick, signaling that long-term holders are refraining from liquidating their DOGE. Instead, these investors are maintaining their positions, which is a good sign for Dogecoin’s price stability. Their continued holding behavior suggests they are confident in a potential recovery.  

This resilience from LTHs plays a crucial role in supporting Dogecoin’s price, particularly during times of uncertainty. While short-term traders may be reacting to market fluctuations, the steadfast actions of LTHs offer the potential for price recovery and a foundation for future growth should broader market conditions improve.  

The broader macro momentum for Dogecoin remains uncertain, as the funding rate has been fluctuating between positive and negative. This fluctuation reflects a market in which traders are uncertain of the direction and shifting their positions accordingly. As the funding rate becomes more negative, short contracts are dominating over long contracts, pointing to increased bearish sentiment.  

This uncertainty in market sentiment has left Dogecoin vulnerable to further volatility. Negative funding rates suggest that traders are betting on further price declines, and a shift toward bearish sentiment may weigh heavily on DOGE’s performance. The lack of clear, bullish indicators means the market remains on edge, especially for short-term investors.  

DOGE Price Prediction: Bouncing Back

Dogecoin is currently priced at $0.254, finding itself back within a descending wedge pattern after briefly slipping out of it. This pattern often suggests potential for upward movement in the future. While the target for the pattern remains above $0.400, the immediate goal for DOGE is to reclaim the $0.268 support level.  

Securing $0.268 as support would be crucial for Dogecoin, enabling the altcoin to move towards $0.311. If the price can establish a solid footing at this level, it may signal the beginning of a more substantial price recovery, drawing in additional buying interest from both retail and institutional investors.  

However, failing to breach $0.268 could set the stage for another downtrend. If the price fails to hold this support, Dogecoin could fall to as low as $0.220, invalidating the bullish thesis and prolonging the current uncertainty. This scenario would signal continued weakness and likely result in further selling pressure. 

Analysts say the crypto market should brace for a wave of token unlocks totaling $17 billion by the end of April, raising concerns about devaluation and market saturation.

This follows a recent market event that saw nearly $10 billion in long liquidations, further straining liquidity.

TGEs and Market Saturation Spell Trouble for New Projects, Analysts Say

BeInCrypto reported on a historic crypto liquidation event provoked by US President Donald Trump’s tariffs. However, Bybit CEO Ben Zhou estimated that crypto liquidations after US tariffs could have been between $8-$10 billion, far exceeding reported figures.

Analysts now warn that the market is increasingly unwilling to support new execution environments that lack unique value propositions.

“The market can no longer absorb execution environments that add no value,” the analyst wrote.

While they cite post-token generation event (TGE) struggles among numerous projects, this perspective aligns with recent reports indicating crypto investors’ shifting focus from meme coins to altcoins with real-world value.

Citing Messari, a recent analysis by DeFi researcher Monk highlights the performance struggles of multiple blockchain projects post-TGE. Since their token launches, projects such as Starknet, Mode, Blast, zkSync, Scroll, and Dymension have experienced sharp declines.

The stark exception to this trend is Hyperliquid, whose HYPE token price has soared by 1100%. This highlights the rarity of success amid a sea of struggling chains.

Historically, large-scale token unlocks have hurt prices. A study by Keyrock Research found that 90% of token unlocks lead to price declines, as increased supply often outstrips demand. When vesting schedules release many tokens into circulation, early investors and insiders frequently cash out, intensifying selling pressure.

Arthur, founder and CIO of Defiance Capital, reinforces this perspective. He highlights significant declines in TVL (total value locked) among most of these chains after their token launches.

“This indicates not only weak token demand but also challenges in attracting and retaining users and liquidity,” Arthur added.

Analyst Explains Why New Chains Are Struggling

Notably, data on DefiLlama shows projects like Scroll and Blast have seen their TVL drop by more than 80% since their TGEs. The broader trend suggests that the market has an oversupply of blockspace.

According to the Defiance Capital executive, new Layer 1 (L1) and Layer 2 (L2) chains are increasingly having difficulty differentiating themselves. The challenge comes as established networks like Solana (SOL) and other prominent L2 solutions continue to thrive.

“The Solana Singularity. 2024’s crop of L1s and L2s launched, pumped, and plummeted. TVL drained; speculation faded, and zero sticky demand. Meanwhile, Solana just keeps winning,” another user, DefiBanked.sol on X, remarked.

The user emphasized that Solana’s strong fundamentals enable it to outpace newer chains. He cited Solana’s exceptional speed (400ms block times) and ultra-low transaction fees. According to the analyst, additional valuables on Solana include its thriving ecosystem spanning DeFi and NFTs, meme coins, and real-world assets (RWAs).

The struggles of recent blockchain launches reveal a growing intolerance for redundancy. Projects that fail to justify their existence will find themselves relegated to irrelevance. Meanwhile, established networks with strong utility, user adoption, and liquidity dominate.

Therefore, developers and investors must shift their focus toward innovation. New chains risk becoming just another casualty in an increasingly competitive space without a clear and compelling use case.