The honeymoon period for crypto asset investment products appears to be over. Following record inflows earlier this year, CoinShares’ latest report reveals a shift in investor sentiment, with outflows dominating for the second week in a row. The total outflow of $206 million indicates growing concern among investors, especially in the United States. Meanwhile, cryptocurrencies such as ADA coin, DOT, LINK are seeing entry. Here are the details…
CoinShares report left its mark on the market
Cryptocurrency investment products appear to be past their honeymoon period. CoinShares’ latest report reveals a shift in investor sentiment following record inflows earlier this year. For the second week in a row, outflows dominated, a total of $206 million in funds went out. This indicates growing concern among investors, especially in the United States.
The report highlights a key factor driving this change: interest rate expectations. cryptokoin.com As we reported, the Fed’s hawkish stance on prolonged periods of high interest rates appears to be dampening enthusiasm for crypto assets. This situation is also reflected in the transaction volumes in ETPs (Exchange Traded Products), which decreased to 18 billion dollars. It is noteworthy that the share of ETP volumes in total Bitcoin volumes (28%) has decreased significantly compared to a month ago (55%). This shows that ETP/ETF investors, who fueled the initial volatility, are becoming increasingly cautious.
Big blow to US ETFs
While the negative sentiment was concentrated geographically, US ETFs took the biggest hit. These well-established ETFs witnessed outflows of $244 million. Interestingly, newly launched ETFs continue to see inflows, albeit at a much slower pace than before. This suggests a potential shift towards these new options, but overall a wait-and-see approach seems to prevail.
While Bitcoin saw the largest portion of outflows at $192 million, it is noteworthy that short Bitcoin positions did not receive significant interest. This suggests that investors are hesitant to bet entirely against Bitcoin despite the current pullback. However, Ethereum continues its losing streak, with outflows totaling $34 million for its sixth consecutive week.
ADA coin, LINK, LTC logged in
There are a few bright spots, however. While multi-asset investment products renewed confidence with an inflow of $9 million, Litecoin and Chainlink also changed the trend with inflows of $3.2 million and $1.7 million, respectively. BNB recorded an inflow of $400 thousand and XRP $1.3 million. Additionally, ADA coin and DOT showed inflows of $1 and $1.5 million, respectively.
The report also sheds light on another area of concern: Blockchain stocks. For the eleventh week in a row, these stocks faced outflows totaling $9 million. This ongoing trend reflects investor concern about the upcoming Bitcoin halving, which is expected to significantly reduce miner rewards.
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