Bitcoin Price Falls Amid ETF Outflows and Fed Rate Hike Concerns

Key Insights

• Bitcoin price headed toward a weekly loss as institutional demand weakened.
• Spot Bitcoin ETF outflows resumed after stronger inflows during the previous week.
• Federal Reserve rate-hike expectations remained elevated despite softer inflation data.

Bitcoin price headed toward a weekly loss as demand from institutional investors weakened.

BTC traded near $63,300 on Friday, Aug. 14, after failing to sustain its latest recovery above $65,000. Barron’s placed Bitcoin near $63,330 during early U.S. trading.

Bitcoin remained almost 50% below its October 2025 record near $126,300. The original draft incorrectly described $126,300 as last week’s high.

The latest decline coincided with weaker Bitcoin ETF flows, fading expectations around the CLARITY Act and continued debate over U.S. interest rates.

However, those factors did not establish that Bitcoin had entered a new bear market. BTC still required a confirmed technical breakdown below major support.

One of the top reasons behind the ongoing Bitcoin price retreat is the odds that the Senate will pass the Market Structure Bill, popularly known as the CLARITY Act, into law.

The Senate has gone into recess and will return in the next few weeks, with the Senate Majority Leader hinting that it will be passed in September this year.

Still, despite the assurance, the prediction market suggests that the bill will not pass and be passed into law. A Polymarket poll with $7 million in assets shows that the odds of the bill being passed into law have dropped to 17%. It has been in a downward trend after peaking at 82% in February.

The CLARITY Act is a major bill being championed by the crypto industry, which has spent over $200 million lobbying for it. It aims to dramatically change how the industry is regulated, by moving the main regulator from the SEC to the CFTC.

Two potential risks are derailing the CLARITY Act. First, there are concerns about stablecoin yield, which banks have opposed, arguing that they will lead to cash outflows from their companies.

Second, Democrats have added a clause that will prevent President Trump and his family members from issuing crypto tokens. The urgency jumped after a report showed that he made over $2 billion in income last year.

The other main risk affecting Bitcoin is that American investors have dumped their ETFs this week, a big reversal compared to what happened last week.

SoSoValue data shows that these funds had over $131 million in outflows on Thursday this week. They had $61 million in outflows a day earlier. As a result, the weekly outflows stand at $330 million, although this may change in today’s session.

The funds had previously added $853 million in assets last week, the biggest increase since June. BlackRock’s IBIT has $47 billion in assets and is followed by Fidelity’s FBTC and Grayscale’s GBTC, which have $10.7 billion and $8.3 billion in assets. Rising ETF outflows is a sign that Bitcoin demand is still weak.

The US published encouraging inflation numbers this week. Both the consumer and producer inflation dropped to 3.5% and 4.7%, respectively. These numbers came a week after the US released weak jobs report.

Taken together, the numbers mean that the Federal Reserve will not be in a hurry to hike interest rates this year. Still, despite all this, there are reasons to believe that the Fed will hike interest rates later this year.

Cleveland Fed’s Beth Hammack has pushed for the bank to hike rates, noting that inflation has remained above the 2% target for five years. Indeed, a Polymarket poll shows that there is a 52% chance that the Fed will hike rates later this year.

Bitcoin’s technical structure remained weak after the latest decline. BTC traded below the 50% Fibonacci retracement level near $71,170 on the supplied chart.

The cryptocurrency also remained below its 200-day exponential moving average. That position indicated that the longer-term recovery had not regained momentum.

Bitcoin also invalidated the earlier double-bottom setup after failing to sustain its rebound.

The latest consolidation showed characteristics of a possible bearish pennant. However, the pattern remains unconfirmed until price breaks below its lower boundary.

The immediate support area sits between $62,000 and $62,500.

A confirmed break below that region would return attention to the psychological $60,000 level.

Further weakness below $60,000 could expose the $57,000 region identified by several technical analysts.

The $50,000 level remains a deeper bearish target rather than the immediate base case. On the upside, Bitcoin price must first reclaim $65,000.

A sustained move above $67,000 would weaken the current bearish structure and reduce the probability of a deeper correction.

ETF outflows and fading CLARITY Act expectations have added pressure. However, softer inflation data reduced one macroeconomic risk by lowering immediate expectations for another Federal Reserve increase.

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