Digital Asset Investment Products Saw Their First Outflow of Funds in Four Weeks

Key Points:

• Digital asset investment products saw $528 million in outflows due to recession fears and geopolitical concerns.
• The US experienced the largest outflows at $531 million, while Canada and Switzerland saw inflows of $17 million and $28 million, respectively.
• Bitcoin had $400 million in outflows, ending a five-week inflow streak, while Ethereum faced $146 million in outflows.

Digital asset investment products recorded outflows of $528 million last week, the first weekly outflow in four weeks.

Read more: Digital Asset Investment Products See Mixed Results Amid Record Inflows 

$528 Million Outflows from Digital Asset Investment Products

That decline was likely fanned by concerns over a US recession and broader market sell-offs across various asset classes that are exacerbating an already precarious geopolitical situation.

Trading volumes in ETPs reached $14.8 billion and formed a below-average 25% market share. Total ETP AUM followed through with the recent price correction, falling $10 bln.

The lion’s share of the outflows was regionally US-centric at $531 million. Germany and Hong Kong had outflows amounting to $12 million and $27 million, respectively. Canada and Switzerland capitalized on the market weakness with inflows of $17 million and $28 million, respectively.

Bitcoin and Ethereum: Diverging Trends Amidst Market Correction

Heavy outflows of $400 million were seen in Bitcoin, with the first price drop after five weeks of consecutive inflows. In contrast, short-Bitcoin products saw their first major inflows since June at $1.8 million.

Ethereum also saw $146 million of outflows, bringing the total net outflows since the launch of US Ether ETFs to $430 million. This total figure disguises positive $430 million inflows into newly launched US ETFs offset by $603 million of outflows from the Grayscale Ethereum Trust. There were small outflows in European ETPs.

Blockchain equities continued to see outflows to the tune of $18 million last week. This aligns with the broader outflows witnessed in tech-related ETFs.