Continued Outflows in Crypto Investment Products, Shifting Regional Sentiment and Altcoin Appeal

Continued Outflows in Crypto Investment Products, Shifting Regional Sentiment and Altcoin Appeal

Crypto News – Crypto investment products at leading asset management firms including CoinShares, Grayscale, 21Shares, Bitwise, and ProShares witnessed a continued trend of outflows, marking the sixth consecutive week. Last week, these crypto funds saw a net reduction of $9 million.

While the outflows moderated from the previous week’s significant $54 million, they contributed to a ten-week streak of cumulative outflows, amounting to a total of $464 million.

This prevailing trend reflects a sense of caution among investors in the market, with discernible regional disparities in response to the regulatory landscape. James Butterfill, the Head of Research at CoinShares, highlighted this divergence in the latest report from the European digital asset manager.

“Regional sentiment showed a clear divergence this week, with Europe experiencing inflows totaling $16 million. Investors in the region view recent regulatory setbacks as an opportunity. Conversely, U.S. investors withdrew $14 million, indicating a sustained concern over recent market developments,” noted Butterfill.

Trading volume also dipped to $820 million for the week, a decline from the previous week’s figure of over $1 billion, and notably below the annual average of $1.3 billion. This mirrors a similar trend observed in the broader crypto market.

In the midst of outflows from Bitcoin and Ethereum investment products, XRP and Solana stood out with inflows of $0.66 million and $0.31 million, respectively. This suggests a discerning approach by investors in the altcoin space, seeking value amidst the market shifts, as highlighted by Butterfill.

Bitcoin investment products registered outflows for the third consecutive week, totaling $6 million. Short-Bitcoin products also saw outflows of $2.8 million, indicating a continued trend of investors exiting their short positions. Notably, Short-Bitcoin outflows have reduced by 78% in assets under management over the past 22 weeks.

Ethereum experienced outflows for the sixth consecutive week, amounting to $2.2 million.

On Friday, CoinShares took a significant step by launching a new hedge fund division, extending its services to U.S. investors. They appointed Lewis Fellas, a seasoned professional in traditional asset management, to lead this new initiative.