TLDR
- Bitcoin dropped to $78,442 after Fed Chair Kevin Warsh delivered a hawkish speech at Jackson Hole
- Warsh said recent lower CPI and PCE prints do not show inflation trends have “meaningfully improved”
- Odds of a September rate hike jumped to 59%, up from 35% the day before
- Spot Bitcoin ETFs saw $202M in outflows on August 28, ending a nine-day inflow streak
- BTC is still up 26.35% month-to-date, its best August performance since 2017
Bitcoin fell sharply on Friday after Federal Reserve Chair Kevin Warsh delivered his first keynote at the Jackson Hole Symposium, sending BTC as low as $78,442 on Bitstamp.
Warsh’s tone was cautious on inflation. He said recent improvements in CPI and PCE data do not mean underlying inflation trends have “meaningfully improved,” and reaffirmed the Fed’s 2% target.
The speech was widely read as hawkish. Traders raised their bets on a September rate hike, with the CME FedWatch tool showing odds climbing to over 59%, up from around 35% the day prior.
🚨 BREAKING:
🇺🇸 Fed Chair Kevin Warsh sounded hawkish at Jackson Hole
– Inflation is still too high
– The 2% target remains the priority
– The economy is still strong
– Rates may not be restrictive enough
– Rate cuts could be harder to come byBottom line: September rate-cut… pic.twitter.com/7UuqM0vqZy
— ardizor 🧙♂️ (@ardizor) August 28, 2026
Warsh also announced the end of forward guidance as a regular Fed practice, calling it a tool that has “overstayed its welcome” since its introduction during the Global Financial Crisis.
The U.S. dollar index rose 0.5% on the day. Bitcoin declined 3.4% to around $77,494, pulling back from a session high of $81,330.
Analyst Ted Pillows noted on X that Bitcoin was hovering near the $80,000 level with weakening momentum. He suggested a pullback toward $74,000–$75,000 was possible before any further upside.
bitcoin:native is hovering around the $80,000 level.
Momentum is weakening a bit, which often happens after such a big move.
A correction towards $74,000-$75,000 makes sense here before more upside momentum. pic.twitter.com/q68e9pSdg7
— Ted (@TedPillows) August 28, 2026
ETF Flows Turn Negative
Spot Bitcoin ETFs saw $202 million in net outflows on August 28, according to SoSoValue data shared by Wu Blockchain, ending a nine-day inflow streak.
Spot Bitcoin ETFs End Nine-Day Inflow Streak With $202M Outflow; Ethereum ETFs Take In $102M
According to SoSoValue, U.S. spot Bitcoin ETFs saw $202 million in net outflows on August 28 (ET), ending a nine-day inflow streak. Spot Ethereum ETFs recorded $102 million in net… pic.twitter.com/jZNxqksmVU
— Wu Blockchain (@WuBlockchain) August 29, 2026
Ethereum ETFs moved in the opposite direction, recording $102 million in net inflows and extending their own inflow streak to 10 consecutive days.
What Drove Last Week’s 22% Rally
Bitcoin’s current pullback comes after a massive 22.2% gain the previous week — its best weekly performance in over three years.
That rally was fueled by favorable U.S. regulatory developments, a rise in institutional inflows, and the so-called debasement trade. Investors moved capital into hard assets like gold and crypto as U.S. national debt crossed $40 trillion and bond yields climbed sharply.
Trading firm QCP Capital noted that for BTC to hold above $83,000, derivatives markets need to stay healthy. They said funding rates should remain contained and open interest should grow gradually, rather than being driven by rapid leverage buildup.
At the time of writing, BTC was up 26.35% month-to-date per CoinGlass data, marking its best August since 2017.
