A landmark executive order signed by President Donald Trump has catalyzed a dramatic resurgence in digital asset exchange-traded products (ETPs), sparking a significant recovery in the crypto market. This policy directive, aimed at integrating cryptocurrencies and other alternative assets into 401(k) retirement plans, swiftly reversed a period of market instability, injecting substantial capital back into the digital asset ecosystem.
Policy Spurs Market Comeback
The turning point for digital asset ETPs occurred last week following President Trump's August 7th executive order. Initially, the market had faced a sharp downturn, experiencing $1 billion in outflows linked to weak US payroll data. However, the new policy initiative quickly turned the tide, triggering an impressive $1.57 billion in inflows that not only erased the earlier losses but pushed the week into positive territory with a net inflow of approximately $572 million. This shift underscores the profound impact of regulatory clarity and institutional accessibility on investor confidence in the digital asset space, even as overall trading volumes remained somewhat subdued due to the typical summer slowdown.
Ethereum Leads Strong Inflows Across Diverse Assets
The recovery saw broad participation across various digital assets, with Ethereum leading the charge. Ethereum ETPs recorded the highest inflows last week at $268 million, pushing its year-to-date inflows to a record-breaking $8.2 billion and its assets under management (AuM) to an all-time high of $32.6 billion. Bitcoin also staged a robust recovery, attracting $206 million in inflows after two consecutive weeks of outflows, contributing to its over $20 billion in fresh capital year-to-date. Beyond the dominant assets, altcoins like XRP and Solana demonstrated significant institutional appeal, with XRP-focused funds reaching a record $1.1 billion in year-to-date inflows and Solana funds seeing $874 million. Regionally, the United States was at the forefront of this capital influx, leading global inflows with $608 million, highlighting the immediate and positive domestic response to the new retirement policy.
