Digital Asset Investment Products Witness $251 Million in Weekly Outflows

According to the latest report from Coinshares, another week of outflows occurs for digital asset investment products. Digital asset investment products saw a fourth straight week of outflows, totalling $ 251 million. Even a significant event in the United States was insufficient to change this development, resulting in newly issued Exchange-Trade Funds experiencing strong outflows of $156 million in the previous week.

Bitcoin Price Drop Triggers Outflows in Digital Assets

According to analysts, the reason for this phenomenon was the price drop of Bitcoin. It had flowed well beyond the cost of acquisition common to those ETFs since their launch, namely, $62,200 per Bitcoin. Most likely, due to this, automatic sales orders were issued to the depositors.

As for the geography of the outflow, most of the outflows were shown by the United States, which withdrew $504 million. Canada, Switzerland, and Germany also showed negative values. Their outflow was $9.6 million, $9.8 million and $7.3 million respectively.

Despite the above-discussed outflows, the positive highlight is the emergence of spot-based Bitcoin and Ethereum ETFs in Hong Kong. The trading volumes show that these two ETFs have garnered significant performance, with total flows worth $307 million during the first week of trading. Bitcoin emerged as market players’ favorite with an outflow of $284 million.

Altcoins Gain Investor Interest Amid Digital Asset Outflows

Bitcoin is the only digital asset that has recorded an outflow over the period analyzed. On the other hand, Ethereum registered a turnaround in market performance after seven weeks of outflows brought inflows of $30 million.

In addition, there was a substantial broadening of investor interest as a number of altcoins saw inflows. In particular, it is worth noting Avalanche, Cardano and Polkadot, from which inflows were $0.5 million and $0.4 and $0.3 million, respectively.

Lastly, the trend towards outflows of investment assets in digital assets continued. However, a favourable response to Hong Kong’s new ETFs and capital inflows into Ethereum and some altcoins show that market participants ’sentiment is volatile. Therefore, the desire to invest in an asset other than Bitcoin is still maintained. However, continued outflows in major markets such as the United States suggest caution from investors, possibly on the basis of intense price volatility and regulatory uncertainty.