Bitcoin
Investors withdraw $584 million from the crypto market
The crypto market is experiencing a significant correction as investors withdrew $584 million from crypto-related investment products last week, according to the latest report from CoinShares. report.
Furthermore, global trading volumes of crypto ETPs have reached their lowest levels since the US Securities and Exchange Commission approved the launch of several spot contracts. Bitcoin exchange-traded funds (ETFs) in January, totaling just $6.9 billion for the week.
This decline continues a trend from the previous week, where investors withdrew around $600 million, bringing the two-week total to nearly $1.2 billion in outflows.
James Butterfill, head of research at CoinShares, commented:
“We believe this is a reaction to pessimism among investors regarding the prospect of interest rate cuts by the FED this year.”
Bitcoin and US lead outflows
Bitcoin investment products had the most significant outflows, totaling US$630 million. Bitcoin ETPs recorded six consecutive days of departures in the US, mainly from the Grayscale Bitcoin ETF and Fidelity’s FBTC.
Canada also witnessed substantial outflows from crypto ETPs, with withdrawals of $109 million. This was followed by Germany and Hong Kong, which recorded outflows of US$24 million and US$19 million, respectively.
Crypto ETP Flows by Country (Source: CoinShares)
On the other hand, Switzerland and Brazil recorded inflows of US$39 million and US$48.5 million, respectively, helping to offset global outflows.
Investors with pessimistic sentiments also withdrew around $1.2 million worth of Bitcoin sales.
About that, Ethereum joined the exit trend, seeing its first withdrawals in weeks totaling approximately $58 million. This reduced its cumulative flow for the month to about $23 million from $82 million.
Altcoins prove attractive
Despite outflows from the main digital asset, multi-asset investment products and some altcoins registered significant inflows.
According to CoinShares, multi-asset products attracted more than $98 million, while SolanaLitecoin and Polygon received $2.7 million, $1.3 million and $1 million respectively.
Butterfill explained that these inflows indicate a new focus by investors on altcoins. He stated:
“[These inflows] suggest that investors view weakness in the altcoin market as a buying opportunity.”