How Did Capital Flows In and Out of Bitcoin and Crypto Investment Products Last Week?

• Last week, Ethereum investment products experienced outflows of $4.8 million, making it “the least-liked digital asset among ETP investors this year” with outflows of $108 million since the beginning of the year.
• Overall, crypto investment products at asset managers such as Bitwise, Grayscale, ProShares and 21Shares saw $59.3 million in output last week.
• “What’s interesting in terms of timing is that [short Bitcoin] inflows in March also came during a period of increased regulatory uncertainty,” Butterfill continued.

Last week, the outflow of money in digital asset investment products continued and Bitcoin and Ethereum experienced intense outflows; Interest in Short-Bitcoin is increasing.

Performance of Digital Asset Products Last Week

Last week, Ethereum investment products experienced an outflow of $4.8 million, making it the ‘least favored digital asset among ETP investors this year’ with a total outflow of $108 million since the beginning of the year, as noted in a report by James Butterfill, the Chief Investment Strategist at CoinShares.

Overall, crypto investment products at asset managers like Bitwise, Grayscale, ProShares, and 21Shares saw an outflow of $59.3 million last week, significantly higher than the $11.2 million outflow seen the previous week, and adding to the total outflows of $294 million in the past month.

However, Bitcoin investment products were among the most affected, with an outflow of $68.9 million last week. On the other hand, short Bitcoin funds reached the largest weekly inflow for the product since March, totaling $15.2 million.

Butterfill stated that the fund flows indicated a bearish sentiment, saying, “The most likely reasons for this are ongoing concerns around regulation in the asset class, and the recent strength in the dollar.”

He continued, “What is interesting timing-wise is that [short Bitcoin] inflows also came during a period of increased regulatory uncertainty back in March.”

Despite subdued flow activity in the previous week, trading volumes also significantly declined last week, falling by 73% to $754 million.

Blockchain stocks also can’t escape negative sentiment

Blockchain stocks also couldn’t escape the negative sentiment and added another $10.8 million outflow in the fifth consecutive week. On a more positive note, XRP investment products continued their positive streak with small inflows totaling $0.7 million over the past week.

Regionally, Germany led the market with an outflow of $20 million, while the U.S. saw an outflow of $12.3 million.