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The cryptocurrency market faced a significant downturn last week, with reported outflows reaching $240 million amid rising global trade tensions.
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The cascading effect of increased US tariffs has led to mounting investor anxiety, notably contributing to Bitcoin and Ethereum’s notable sales.
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“Digital asset investment products saw outflows totaling $240m last week, likely in response to recent US trade tariff news that poses a threat to economic growth,” CoinShares’ James Butterfill remarked.
Bitcoin and Ethereum experience substantial outflows amid rising US trade tariffs, with investors wary of the impact on global market stability.
Crypto Market Suffers Major Setback with $240 Million Outflows
In a notable shift in investor sentiment, crypto ETPs (exchange-traded products) report outflows totaling $240 million for the week. This drastic figure highlights the growing unease among investors as geopolitical incidents reshape market dynamics.
According to a recent report by CoinShares, Bitcoin was predominantly affected, with $207 million in outflows, significantly impacting its year-to-date inflow volume, which now totals $1.3 billion. Ethereum was not spared either, suffering approximately $37.7 million in outflows, alongside minor reductions in Solana and Sui of $1.8 million and $4.7 million respectively.
The previous week had shown a contrasting trend with altcoin inflows of $18 million, illustrating a dramatic reversal in market sentiment that culminated with the surge in outflows.
Crypto Outflows Last Week. Source: CoinShares
The outflows were predominantly led by US investors, totaling $210 million, indicating a pronounced reaction to United States’ trade policies. This situation was aggravated by President Trump’s announcement of additional tariffs starting on April 5, representing a shift towards protectionism that raises concerns about economic growth.
“China accuses the US of unilateralism, protectionism, and economic bullying with tariffs,” highlighted analyst Jackson Hinkle, emphasizing the geopolitical stakes underpinning the economic decisions.
US Bitcoin ETFs See Major Net Outflows of $172 Million
The impact on institutional investment is starkly illustrated in the Bitcoin ETF market, where net outflows reached an alarming $172.89 million last week. This marks the end of a two-week inflow streak that had seen nearly $941 million enter the market.
Bitcoin ETF Outflows. Source: SoSoValue
Grayscale’s GBTC led the redemptions with $95.5 million, while WisdomTree’s BTCW recorded $44.6 million in outflows. Other ETFs, including BlackRock’s IBIT and ARK 21Shares’ ARKB, followed suit with significant redemptions, showcasing a larger trend of investor caution.
A notable point in the data is that despite an inflow of $220.76 million during the week, the losses across other days overshadowed this brief surge. Tuesday alone saw redemptions reach up to $157.64 million, underscoring the volatility within the market.
Bitcoin ETF Flows Last Week. Source: Farside Investors
The Ethereum ETF landscape reflected a similar downturn, experiencing six consecutive weeks of outflows, with a total close to $800 million. Last week, Ethereum products alone saw a decline of $49.93 million. The narrative of risk aversion contributes significantly to this drop.
On a positive note, select funds such as Franklin Templeton’s EZBC and Fidelity’s FBTC managed to attract $61.8 million in inflows, indicating pockets of sustained interest amid this broader trend.
“Dismissing on-chain data due to paper Bitcoin is misguided,” stated Ki Young Ju, CEO of CryptoQuant, reinforcing the need for a comprehensive understanding of market trends amid these developments.
Conclusion
As the cryptocurrency market navigates through this rough terrain marked by substantial outflows, investors remain cautious as they assess the potential implications of ongoing geopolitical tensions. The observed changes reflect broader shifts in market behavior, urging stakeholders to remain vigilant about fluctuations that could impact future investments and strategies.
