Crypto asset investment products have been going through a rough patch, seeing consecutive outflows over the last four weeks. This shows that despite the launch of new Bitcoin ETFs, investors are concerned about the recent falling prices. Last week, Bitcoin was again the most affected asset, with outflows totaling $251 million. In contrast, Ethereum saw inflows of $30 million, breaking its seven-week outflow streak. Some altcoins such as Avalanche, Cardano, and Polkadot also experienced small inflows. The successful launch of spot Bitcoin and ETH coin ETFs in Hong Kong was the only bright spot of the week. These ETFs saw inflows of $307 million in their first week of trading.
There is an outflow of funds from some cryptocurrency products
Cryptoasset investment products continued to see outflows for the fourth week in a row, with a total outflow of US$251 million. This was despite the successful launch of spot-based ETFs in Hong Kong, which generated inflows of US$307 million in the first week of trading. Outflows were primarily concentrated in the US, where US$504 million left crypto asset investment products. Canada, Switzerland and Germany also experienced outflows of USD 9.6 million, USD 9.8 million and USD 7.3 million, respectively.
BTC outflows were balanced by ETH coin inflows
Bitcoin was the main driver of outflows, with $284 million leaving Bitcoin investment products. This was the only crypto asset to see outflow during the week. Ethereum, on the other hand, broke its seven-week outflow streak, with $30 million flowing into Ethereum investment products. A number of altcoins also saw entry; Avalanche, Cardano, and Polkadot experienced the most significant inflows at $0.5 million, $0.4 million, and $0.3 million, respectively.
Outflows from crypto asset investment products are likely due to the recent decline in Bitcoin price. The average purchase price of newly issued ETFs in the US is estimated at $62,200 per Bitcoin. A drop in Bitcoin price 10% below this level may have triggered automatic sell orders from investors.
What about ETFs in Hong Kong?
The successful launch of spot-based Bitcoin and Ethereum ETFs in Hong Kong was critical. According to data, the crypto asset has provided a bright spot for the investment products industry. ETFs saw inflows of US$307 million in the first week of trading. This shows that investors’ interest in the Hong Kong market is strong.
Overall, last week was a mixed week for crypto asset investment products. While exits continue to dominate, the successful entry of ETFs in Hong Kong has attracted attention. Because it shows that there is still significant interest in this asset class. It will be interesting to see how the price of Bitcoin and other crypto assets will affect investor sentiment in the coming weeks.
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