Crypto Investment Products Experience Second Consecutive Week of Outflows: CoinShares Report Highlights
Crypto-related investment products saw their second consecutive week of outflows in April, with roughly $206 million leaving the market, per CoinShares‘ recent weekly report. Despite Bitcoin’s recent halving, which typically generates excitement in the market, investor interest in the leading digital asset remained subdued, evidenced by outflows totaling $192 million. Conversely, short-term investors seized the opportunity presented by the halving event to strengthen their positions, injecting $300,000 into the market.
During the past week, US-based Bitcoin exchange-traded funds (ETFs) experienced five consecutive days of outflows, driven primarily by Grayscale’s GBTC, ProShares BITO, and Ark 21 Shares’ ARKB. James Butterfill, the Head of Research at CoinShares, explained that these outflows signify a dwindling interest among ETP/ETF investors, with speculations that the Federal Reserve may delay rate cuts further. Additionally, trading volumes of ETPs declined to $18 billion last week, representing a lesser share of total BTC volumes, marking a shift from 55% a month ago to 28%.
Investors are increasingly favoring lesser-known altcoins over major cryptocurrencies like Solana and Ethereum. Altcoins such as Chainlink, Polkadot, Litecoin, Cardano, and XRP collectively attracted over $7 million in inflows last week. Ethereum saw its sixth consecutive week of outflows totaling $34 million, with a negative month-to-date flow of $85 million and a year-to-date flow of $11 million. Solana experienced modest outflows of $300,000, while blockchain equities recorded their 11th consecutive week of outflows, reaching $9 million. Butterfill attributed the outflows from blockchain equities to investor concerns regarding the impact of mining halving on mining companies.
Overall, the crypto market continues to see fluctuations in investor interest and flows, with altcoins drawing increasing attention while major cryptocurrencies like Bitcoin and Ethereum experience outflows. The evolving landscape of the crypto market presents both challenges and opportunities for investors looking to navigate the volatile market.
