Record Outflows in Crypto Market
Last week, the cryptocurrency market experienced its most significant weekly sell-off, with outflows reaching a record $2.9 billion, as reported by CoinShares.
This marked the third consecutive week of capital leaving digital asset investment products, totaling outflows of $3.8 billion.
Reasons for the Downturn
CoinShares’ Head of Research, James Butterfill, attributed the downturn to multiple factors. He mentioned the recent security breach at Bybit and a more assertive stance from the US Federal Reserve as contributing to weakened investor confidence and increased capital withdrawals.
Butterfill also noted that investors took profits following a 19-week inflow streak of $29 billion.
Bitcoin Products in the US Lead to Outflows
Investors withdrew $2.87 billion from US-based funds, impacting major spot Bitcoin exchange-traded fund (ETF) issuers.
BlackRock experienced $1.3 billion in withdrawals, while Fidelity lost over $569 million. Grayscale also saw significant exits, with $421 million leaving its funds.
Other firms, including Bitwise and 21Shares, witnessed combined outflows exceeding $130 million.
Global Trends
Outside the US, Switzerland and Canada saw net outflows of $73 million and $16.9 million, respectively. However, Germany attracted $55.3 million as investors maintained a bullish outlook.
Bitcoin’s decline triggered a modest rise in short Bitcoin product inflows, reaching $2.3 million.
Sui and XRP Defy Market Trends
Ethereum faced a sharp sell-off, with record weekly outflows of $300 million. Other digital assets like TON and Solana also struggled, shedding $22.6 million and $7.4 million, respectively.
Blockchain equities ETPs saw $25.3 million outflows amidst the negative sentiment.
However, Sui attracted $15.5 million in inflows, while XRP received a $5 million inflow driven by speculation over a potential US spot XRP ETF and regulatory clarity expectations under the Donald Trump administration.
