Digital Assets See $54 Million Weekly Outflows, Totaling $455 Million Over 8 Weeks: CoinShares
In a recent development reflecting the evolving dynamics of the digital asset market, CoinShares’ Digital Asset Fund Flows Weekly Report reveals a continued trend of outflows totaling nearly half a billion US dollars over the last nine weeks. The report highlights the ongoing challenges faced by digital asset investment products, with Bitcoin being particularly affected.
Digital asset investment products experienced outflows totaling $54 million in the past week, marking the fifth consecutive week of negative flows. The report also emphasizes the cumulative outflows of $455 million over eight of the last nine weeks, indicating a significant decline in investor confidence. Year-to-date net inflows have dwindled to just $51 million.
The negative sentiment primarily emanated from the United States, where 77% of the outflows occurred. However, this trend was not confined to the US, as Germany, Canada, and Sweden also experienced outflows. Despite these challenges, weekly trading volumes did show a glimmer of hope, reaching $1 billion, marking a 42% increase from the previous week.
Bitcoin, the flagship cryptocurrency, bore the brunt of these outflows, accounting for a substantial 85% of the total outflows, amounting to $45 million in the last week. This followed short-lived short-Bitcoin inflows of $3.8 million from the previous week. Nevertheless, it’s worth noting that Bitcoin remains a favored investment product, with month-to-date inflows standing at $12 million.
Ethereum, often touted for its strong fundamentals and high demand for staking yield, saw outflows totaling $4.8 million in the past week. This unexpected outflow raises questions about the market’s assessment of Ethereum’s true value.
While the broader digital asset market experienced outflows, some altcoins managed to defy the trend. Solana, Cardano, and XRP all attracted inflows of $0.7 million, $0.43 million, and $0.13 million, respectively. These exceptions suggest that the market is nuanced, with select digital assets still considered attractive by investors.
The challenges in the digital asset market extended to blockchain equities, which recorded their sixth consecutive week of outflows, amounting to $9.6 million last week. This indicates that the skepticism surrounding digital assets is not limited to cryptocurrencies alone.
In conclusion, CoinShares’ Digital Asset Fund Flows Weekly Report paints a picture of a digital asset market grappling with persistent outflows, primarily driven by concerns in the United States but with global ramifications. While Bitcoin remains a preferred investment, it too faces headwinds. Ethereum’s recent struggles raise questions about the broader market’s outlook. However, the inflows into select altcoins demonstrate that investor sentiment remains dynamic, with opportunities still existing in this evolving landscape. Blockchain equities, on the other hand, continue to bear the brunt of negative sentiment, highlighting the challenges facing the entire digital asset ecosystem.
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