Highlights:
- Crypto ETPs experienced a historic outflow of $2.9 billion last week, contributing to a total outflow of $3.8 billion over three weeks.
- The iShares Bitcoin Trust (IBIT) by BlackRock was notably affected, with a record outflow of $1.3 billion.
- Overall, Bitcoin investment products saw a reduction of $2.6 billion, although Sui (SUI) and XRP managed to attract some investments.
Crypto exchange-traded products (ETPs) have witnessed their largest weekly sell-off on record, as investors withdrew around $2.9 billion from these funds, according to a report by CoinShares unveiled on Monday.
These substantial outflows signify a notable shift in investor sentiment following a prolonged period of consistent investment in digital assets.
The latest withdrawals have extended a streak of three weeks of outflows, totaling $3.8 billion. James Butterfill, a research analyst at CoinShares, identified several underlying factors for this decline. Such factors include heightened investor worries due to the recent $1.5 billion hack of the crypto exchange Bybit, along with the Federal Reserve’s increasingly hawkish monetary policy stance.
Before this downturn, crypto investment products had enjoyed 19 weeks of consecutive inflows, indicating that some investors were locking in profits while market uncertainty grew.
As the largest cryptocurrency by market capitalization, Bitcoin (BTC) faced the majority of these withdrawals, losing $2.6 billion in a single week. Notably, funds betting against Bitcoin, termed short Bitcoin ETPs, recorded a slight inflow of $2.3 million, suggesting bearish sentiment hasn’t fully taken root yet.
Despite these challenges, a few assets defied the trend—Sui (SUI) emerged as the top performer with $15.5 million in inflows, succeeded by XRP, which also gained fresh investments.
Bitcoin ETFs are encountering a particularly tough week, marked by significant capital withdrawals. The iShares Bitcoin Trust (IBIT) marked a staggering outflow of $1.3 billion, indicating the highest weekly withdrawal since its inception.
Furthermore, the open interest for CME Bitcoin futures has sharply dropped, signaling potential changes in institutional positioning as interest rates offer minimal returns compared to safer investments.
“This indicates that hedge funds are unwinding their basis trade positions, shifting towards safer, more liquid assets,” said James Van Straten, an analyst at CoinDesk.
Disclaimer: Parts of this article were generated with the assistance of AI tools and reviewed to meet editorial standards. For more information, see CoinDesk’s full AI Policy.
