Tariff(ic) Volatility is Back, ETF Outflows, and the First White House Crypto Summit

• BTC ETFs experienced net outflows of $377.2M, while ETH ETFs saw $173.9M in outflows
• The annualized basis on CME bitcoin futures dropped to low single digits
• The crypto market is closely watching the first-ever White House Crypto Summit

Crypto markets traded two ways, ETFs saw outflows, leverage flush out  

Crypto markets traded both ways this week, with total market cap hovering just below $3 trillion and bitcoin dominance holding above 60%. Among major assets, bitcoin recorded a modest weekly gain of 2.1%, while ether tumbled 10.1% compared to the previous week. The US spot ETF market saw outflows across both BTC and ETH products. BTC spot-only ETFs experienced net outflows of $377.2 million over the past 5 trading days, while ETH ETFs recorded cumulative outflows of $173.9 million during the same period. Focusing on BTC spot ETF flows, BlackRock’s IBIT saw net outflows of $472.7 million over the past 5 trading days, while Fidelity’s FBTC posted cumulative inflows of $122.6 million.

Beyond the recent price decline, many believe the ETF outflows are also tied to the sharp narrowing of BTC CME annualized basis, which has dropped into the single digits compared to levels above 15% at the start of the year. One of the expected drivers of ETF subscriptions was cash-and-carry trades — where traders buy the ETF and sell CME futures to capture the basis. This trade works best when the CME futures annualized basis is significantly wider than the cost of borrowing capital. As the basis compresses, the attractiveness of this trade fades. The narrowing is visible across the entire term structure. On crypto-native exchanges, where most of the futures liquidity sits in perpetual futures, funding rates have also collapsed. According to The Block’s data, the average daily BTC funding rate across all perpetual contracts on Binance has fallen to 2.6%, down from 10% at the start of the year.

Basis and funding rates both reflect the implied price difference between current spot and future prices. A positive basis (or positive funding rate) indicates the market expects future prices to be higher than current spot; negative suggests the market expects future prices to be lower than spot. The more one-sided positioning or leverage there is in the market, the wider the basis can become. Recent volatility has flushed out much of this leverage — bitcoin open interest as a percentage of market cap has fallen below 2% for the first time since February 2024. Markets traded higher over the weekend on positive expectations around reserves but sharply reversed following tariff headlines, some of which had only a brief impact. President Donald Trump announced a one-month exemption on auto tariffs for Mexico and Canada, helping markets recover some of the losses shortly after.

Anticipation builds for the inaugural White House Crypto Summit  

The crypto markets are eyeing the first-ever White House Crypto Summit, set for March 7, hosted by US President Donald Trump. The roundtable is expected to bring together more than 25 participants, including members of the Presidential Working Group on Digital Assets, according to Fox Business reporter Eleanor Terrett. As of Wednesday morning, Terrett reported that 11 crypto executives and 2 White House representatives had confirmed their attendance. “It’s unclear at this point who, aside from Bo Hines and David Sacks, will be attending,” Terrett noted, “but if you revisit Trump’s executive order, the Presidential Working Group also includes Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, Attorney General Pam Bondi, along with the SEC Chair, CFTC Chair, and others.

"Although Ripple CEO Brad Garlinghouse wasn’t explicitly mentioned in Terrett’s latest update, he previously hinted at his attendance in a March 2nd post on X, shortly after Trump’s crypto czar David Sacks announced the summit on March 1. The confirmed guest list so far includes senior leadership from Strategy, VC firm Paradigm, crypto wallet Exodus, Multicoin Capital, Chainlink, Coinbase, Robinhood, Kraken, Ripple, and Crypto.com.“

A larger, invite-only reception is also being planned across the street from the White House for those not invited to the roundtable,” Terrett reported. However, she added that the plans are not yet finalized and could still change. As speculation around the summit grows, the crypto community has called for the inclusion of other prominent industry figures, including ARK Invest founder Cathie Wood, Ethereum co-founder Vitalik Buterin, Circle co-founder Jeremy Allaire, Tether CEO Paolo Ardoino, Cardano founder Charles Hoskinson, and Solana co-founder Anatoly Yakovenko. The summit comes amid rising anticipation over the Trump administration’s stance on the possibility of a US cryptocurrency reserve. Trump’s Commerce Secretary Howard Lutnick has already hinted that bitcoin could receive special consideration under the administration’s crypto policy. “The President definitely thinks there’s a bitcoin strategic reserve,” Lutnick said, according to a March 5 report by The Pavlovic Today. “The next question is: how do we handle other cryptocurrencies? I think that framework will be announced on Friday during the summit,” Lutnick reportedly added.

Zooming out from recent price action, crypto markets — while not moving in lockstep with traditional assets — still feel the impact of broader macro factors. The Fed’s unexpectedly hawkish pivot and the scale of Trump’s tariffs triggered a global sell-off across risk assets, including crypto.

Additional supply pressure came from token unlocks. Bybit suffered one of the largest ever industry hacks with a loss of $1.5 billion, but the broader crypto industry rallied to support the exchange. Major exchanges blacklisted the hackers’wallets, showcasing rare unity and highlighting the sector’s growing maturity. Bybit swiftly processed over 350,000 withdrawals within 12 hours and returned to normal operations within 24 hours.

Looking ahead to the remainder of the month, March has historically been a volatile month for crypto, with bitcoin posting positive returns in 5 of the past 8 years since 2017.

Macro pulse  

TradFi assets experienced a risk-off sentiment, with oil futures dropping 3.4% and US equities falling 1.9% compared to the previous week. The focus shifted to US trade updates, where the US delayed auto tariffs on Canada and Mexico for 30 days. President Trump also told Canadian PM Trudeau that progress on borders had been reasonable but more needed to be done on fentanyl imports. Meanwhile, participants digested mixed data, including a disappointing ADP jobs report and a stronger-than-expected ISM Non-Manufacturing PMI. Elsewhere, the US Dollar index slipped 0.6%, 10-year US Treasury yields rose by 3 bps, and the Gold and Silver index gained 1.1% week on week.

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_{Note: Weekly (7 calendar day) performance figures are as of 8am SGT on March 6, 2025}

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