Crypto ETPs Face Worst Week in Months: Is This the Beginning of a Major Downturn?
Cryptocurrency exchange-traded products (ETPs) saw losses of $876 million during the most recent trading week, marking the fourth consecutive week of withdrawals. CoinShares announced on March 10 that crypto ETPs resumed their downward trend after seeing record weekly withdrawals of $2.9 billion the previous week, bringing the four-week total outflows to $4.75 billion.
According to James Butterfill, head of research at CoinShares, investor sentiment remained pessimistic even as the rate of outflows slowed. According to the analyst, the market is also showing signs of capitulation.
Bitcoin and Altcoins Suffer Major Withdrawals as Crypto ETPs Hit Record Low
ETPs have had considerable outflows over the past month, indicating a dramatic shift in investor sentiment occurring in the cryptocurrency market. The majority of this trend has been driven by Bitcoin ETPs, which accounted for 85% of last week’s total withdrawals, or $756 million. As a result of this slump, overall assets under management (AUM) have dropped precipitously, reaching their lowest level since November 2024, down $39 billion to $142 billion.
The data paints a troubling picture for cryptocurrency investment products when examined more closely. The year-to-date inflows have dropped to only $2.6 billion, while the total withdrawals over the last four weeks have reached an astounding $4.75 billion. This decline has been mostly caused by unfavorable price fluctuations and persistent outflows, with Bitcoin ETPs bearing the brunt of this. Additionally, $19.8 million was taken out of Short-Bitcoin ETPs, the biggest outflow since December 2024.
Several altcoins experienced significant outflows, demonstrating that the bearish outlook was not limited to Bitcoin. Tron and Aave saw withdrawals of $32 million and $2.4 million, respectively, while Ether ETPs saw a substantial $89 million outflow. However, it wasn’t all bad news, either. A few cryptocurrencies defied the trend, with inflows still occurring in Solana, XRP, and Sui. With $16.4 million in inflows, Solana was the largest, followed by XRP ($5.6 million) and Sui ($2.7 million).
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