Crypto investment products finally recorded a week of outflows after seven weeks of consecutive strong inflows and two weeks breaking records after the records. In fact, data shows that these investment products have now set a new record for the most outflows in a week, extending the record-setting period.
According to data from CoinShares, investors withdrew $942 million from crypto investment products last week to eliminate $10 billion from total assets under management (AuM). Interestingly, a larger portion of this outflow came from Bitcoin, as Spot Bitcoin ETFs in the U.S. departures recorded every day.
Crypto Outflows Hit New High
CoinShares weekly report on digital investment funds revealed that crypto investment products have been witnessing an influx of money into the last two months. Consequently, these products recorded a seven-week series of inflows, totaling US$12.3 billion. Bitcoin, the largest cryptocurrency, received the lion’s share of these inflows, which helped push its price to a level new historical record.
However, last week told a different story for Bitcoin investment products, as Spot Bitcoin ETFs in the US recorded weak inflows of $1.1 billion, which were unable to offset significant outflows of $2. billion from Grayscale. As a result, Bitcoin investment products witnessed outflows of $904 million during the past week. Bitcoin short products also witnessed small outflows of $3.7 million.
Negative sentiment flowed into other investments products like Ethereum, Solana, Cardano, and multi-asset products saw outflows of $34.2 million, $5.6 million, $3.7 million, and $7.3 million, respectively. On the other hand, Litecoin, XRP, and Polkadot recorded an increase in their respective inflows of $2 million, $1.2 million, and $5 million. Lastly, total trading volume fell to $28 billion, two-thirds of the previous week.
In terms of region, the US had the highest number of outflows at 860 million dollars. Sweden and Switzerland followed with US$36.9 million and US$25.2 million, respectively. According to CoinShares, the reversal to poor sentiment was largely due to investor hesitation.
What’s next for Bitcoin?
Interestingly, last week’s exit from Spot Bitcoin ETFs coincided with a drastic drop in the cryptocurrency’s Bitcoin price. falling as low as $61,370. This shows how much influence these funds now have over the price of Bitcoin. Last week’s actions show that investors appear to be taking a break from their enthusiasm for spot bitcoin ETFs. It is not yet known whether this pause will last weeks or longer.
However, the feeling can change quickly in the cryptocurrency market and recent price action shows that the industry may be returning to high mode. According to data from BitMEX Research, Spot Bitcoin ETFs recorded a day of net inflows yesterday. The net inflow recorded was US$15.7 million, the lowest day of inflow since January 26th.
The bulls have now taken control push the price of Bitcoin by 5.38% in the last 24 hours. At the time of writing, Bitcoin is trading at $70,676 and could reach $73,000 again very soon.
BTC price drops from $71,000 | Source: BTCUSD on Tradingview.com
Featured image from Atlantic Council, chart from Tradingview.com
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