Crypto Asset Investments See Second Week of Outflows, Led by Bitcoin Decline

Crypto asset investment products experienced a second week of outflows, totaling $206 million, according to CoinShares. ETP trading volumes have decreased slightly, with Bitcoin volumes at 28%, down from 55% a month ago. US ETFs have seen significant outflows, while Canada, Switzerland, and Germany have experienced mixed inflows and outflows. Ethereum continued its outflow streak for the sixth week, while multi-asset investments witnessed inflows.

Crypto Asset Investment Products Experience Second Consecutive Week of Outflows

In a market update released by CoinShares, the crypto asset investment products sector has witnessed a decline for the second week in a row, with total outflows amounting to $206 million. This downturn is accompanied by a slight decrease in trading volumes for exchange-traded products (ETPs) to $18 billion.

Notably, these figures represent a significant decline in Bitcoin volumes, which currently stand at 28% compared to 55% a month ago. This shift indicates a waning interest among ETP/ETF investors, potentially attributed to the Federal Reserve's anticipated interest rate hikes in the near future.

Regional Dynamics

A deeper examination of regional dynamics reveals that the negative sentiment primarily emanated from US ETFs, which accounted for $244 million in outflows. Interestingly, these outflows were concentrated in established ETFs, while newly introduced ones experienced inflows, albeit at a subdued rate compared to previous weeks. In contrast, Canada and Switzerland observed inflows of $30 million and $8 million, respectively, while Germany witnessed minor outflows of $8 million.

Individual Cryptocurrencies

Zooming in on individual cryptocurrencies, Bitcoin experienced outflows amounting to $192 million, although investors refrained from short-selling opportunities, as evidenced by a mere $0.3 million in outflows from short-bitcoin positions. Ethereum, on the other hand, continued its streak of outflows for the sixth consecutive week, totaling $34 million.

Multi-asset investments, however, witnessed a surge in sentiment, with inflows totaling $9 million for the preceding week. Additionally, Litecoin and Chainlink garnered inflows of $3.2 million and $1.7 million, respectively.

Blockchain Equities

Data obtained by CoinShares also reveals that blockchain equities have experienced a weekly outflow of funds for the 11th consecutive week, amounting to $9 million. This ongoing trend is attributed to investor concerns about the impact of halving on mining firms, indicating an environment of caution within that market segment.

Conclusion

The crypto investment landscape remains fluid and subject to shifts in sentiment and investor preferences, influenced by factors such as policy moves and macroeconomic changes. As the industry continues to evolve, it is prudent to monitor market trends and adjust investment strategies accordingly.