CoinShares, an innovative digital asset management firm in Europe, recently reported on record withdrawals from cryptocurrency investment products. Their report indicates that over $2.9 billion had been pulled out in just one week alone – leading to total withdrawals over three weeks of $3.8 billion! This decrease is in stark contrast with 19 weeks prior when this market experienced substantial inflows totaling $29 billion.
Bitcoin and Ethereum Experience Major Sell-offs
CoinShares recently published its latest report and found that Bitcoin took the hardest hit, accounting for $2.59 billion of total outflows last week. Short Bitcoin products saw slight investments increase of approximately $2.3 million. Ethereum experienced its highest weekly outflow ever with $300 million leaving, along with several altcoins such as Solana and Ton seeing withdrawals of $7.4 million and $22.6 million respectively. Nonetheless, some assets managed to attract investment despite bearish sentiment; Sui saw $15.5 million come through and XRP brought in $5 million new funds despite bearish sentiment; Sui drew $15.5 million while XRP secured $5 million more funds despite market sentiment prevailing.
Overall, sentiment in the digital assets market remains cautious with blockchain equities seeing outflows of $25.3 million in just the past week alone.
Driving Factors Behind the Withdrawals
James Butterfill, Head of Research for CoinShares, attributes these massive outflows to several factors – including the aftermath of Bybit’s hack, Federal Reserve policy changes that increased enforcement activity and profit-taking following earlier prolonged inflows – which collectively caused investor sentiment to decrease and forced many holders to liquidate their positions.
Outflows were predominantly seen from the United States, totalling $2.87 billion, followed by smaller amounts from Switzerland and Canada. German investors demonstrated optimism by injecting $55.3 million into the market; taking advantage of lower prices while adapting regional investment strategies in response to current market dynamics.
Last week’s significant outflows have not prevented Bitcoin and the cryptocurrency market as a whole from experiencing a steady recovery in value. Bitcoin in particular has passed the $90,000 mark and now trades over $92,000, reflecting an 8.7% gain since yesterday. Much of this recovery can be attributed to President Donald Trump’s announcement of US plans to establish a crypto strategic reserve including BTC, ETH, SOL, XRP and ADA; which President Trump proposed as being included as reserves by this plan.
