Crypto investment products encountered substantial outflows last week, with a total of $305 million withdrawn, as negative sentiment spread across various providers and regions. CoinShares’ latest weekly report highlights this trend.
James Butterfill, CoinShares’ head of research, attributed the outflows to stronger-than-expected economic data from the US. He mentioned that this data “diminished the likelihood of a 50-basis point interest rate cut.”
He further explained:
“We continue to expect the asset class to become increasingly sensitive to interest rate expectations as the FED gets closer to a pivot.”
Bitcoin and US Markets Lead the Outflows
Bitcoin bore the brunt of these outflows, with major asset managers such as Grayscale, ProShares, and 21Shares all reporting net losses last week. Bitcoin saw $319 million in outflows, while the US market experienced a close total of $318 million.
In contrast, short Bitcoin investment products saw their most significant inflows since March, attracting $4.4 million for the second consecutive week.
Ethereum also faced outflows, losing $5.7 million. Trading volumes for Ethereum remained stagnant, at just 15% of those seen during the US ETF launch week.
Ethereum ETFs Lag Behind Bitcoin ETFs
Galaxy Digital previously noted that Ethereum ETFs are trading at significantly lower volumes compared to Bitcoin ETFs. The trading volumes of Ethereum ETFs are well below the ETH/BTC centralized exchange volume and market cap ratios. This gap is partly due to prime trading desks not yet offering margin on Ethereum ETFs.
As reported:
“The ratio of Ethereum ETF volume to Bitcoin ETF volume in the first 25 days has continued to decline.”
Solana and Blockchain Equities Defy the Trend
Despite the overall negative market, Solana attracted $7.6 million in inflows, bucking the broader trend. Additionally, blockchain equities showed positive momentum, with $11 million flowing into products focused on Bitcoin miners.
This surge in investment for miners comes as they find new ways to leverage their BTC mining equipment by supplying computational power to artificial intelligence (AI) companies.
VanEck projects that if Bitcoin miners allocate 20% of their energy capacity to AI computation by 2027, they could increase their average yearly profits to nearly $14 billion.
The post Bitcoin leads $305 million outflows as strong US economic data hits crypto appeared first on CryptoSlate.
