Continuing a trend that has persisted for three consecutive weeks, the cryptocurrency market witnessed substantial outflows totalling $435 million as Bitcoin experienced a notable decline of over 5% last week.
Investors, responding to this downturn, opted to withdraw capital from various virtual asset vehicles, including spot exchange-traded funds (ETFs).
CoinShares data revealed that the outflows from digital asset investment products coincided with a 6% decrease in ETF trading volume, with activity plummeting from a staggering $18 billion two weeks before $11.8 billion last week.
Bitcoin (BTC) and Ethereum (ETH) dominated these exits, accounting for $423 million and $38 million, respectively.
The majority of these outflows, particularly in BTC, were observed in the U.S. and predominantly domiciled in Grayscale’s converted GBTC ETF.
Grayscale’s spot Bitcoin ETF experienced a substantial loss of $440 million in outflows, marking the lowest weekly GBTC withdrawals since March.
Simultaneously, inflows into new spot BTC ETFs also dwindled amid stagnant Bitcoin prices, with only $126 million in cumulative capital flowing into 10 newly introduced spot BTC ETFs offered by industry giants like BlackRock and Fidelity.
While Ethereum outflows mirrored BTC sentiment, crypto altcoin products garnered increased attention from asset managers and investors alike.
CoinShares analysts noted a diverse range of altcoins attracting inflows, with investors favouring multi-coin investment products alongside perennial favourites like Solana, Litecoin and Chainlink.
In total, over $9 million flowed into these altcoin investment products, with Solana (SOL) leading the pack with $4 million in inflows, followed by Litecoin (LTC) with $3 million and Chainlink (LINK) with $2.8 million.
This diversification of investment highlights investors’ willingness to explore alternative opportunities within the cryptocurrency landscape amidst market volatility.