6 Straight Weeks of Outflows for Bitcoin

The outflows were in stark contrast to the broader market, suggesting it was in part due to the need for liquidity.

JamesButterfill310x310
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Head of Research and Investment Strategy
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Reviewed by: James Butterfill
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Edited by: James Butterfill

Takeaways

  • Digital asset investment products saw outflows for the 6th consecutive week totalling US$95m, with the 5-week total being US$406m, representing 1.2% of total assets under management (AuM).
  • Bitcoin remained the focus of negative sentiment, seeing outflows in investment products totalling US$113m last week.
  • The outflows were in stark contrast to the broader market and suggest it was, in part, due to the need for liquidity rather than negative sentiment.

 

 

Digital asset investment products saw outflows for the 6th consecutive week totalling US$95m, with the 5-week total being US$406m, representing 1.2% of total assets under management (AuM). AuM has risen by 26% over the last week and at US$33bn is the highest it has been since the Three Arrows Capital collapse in June 2022. Trading volumes in investment products were double the average at US$2.6bn.

In stark contrast to the broader market, Bitcoin remained the focus of negative sentiment, seeing outflows in investment products totalling US$113m last week, with the last 6 weeks’ outflows totalling US$424m. Despite the outflows, total AuM has risen 32% over the week. Conversely, despite inflows into short-bitcoin totalling a record US$35m last week, its AuM fell by 13% over the same period. It is evident this sentiment is contrarian relative to the rest of the crypto market, but it may be driven, in part, by the need for liquidity during this banking crisis, a similar situation was seen when the COVID panic first hit in March 2020.

Altcoins, aside from Ethereum (US$13m outflow last week), bucked the trend, seeing only inflows which totalled US$1.3m last week. This positive sentiment provides further credence to the notion that the outflow in the larger crypto assets were driven by the need for liquidity.

 

 

 

 

 

 

Contact James Butterfill at [email protected]

James Butterfill has over 19 years of experience in fund management, investment banking, economics and asset allocation, gained most recently as an investment strategist at CoinShares. Previously, he was head of research at ETF Securities, with prior experience as a multi-asset fund manager and investment strategist at Coutts & Co., HSBC & ING Barings. James is a regular media commentator, and frequently appears on Bloomberg TV, CNBC, BBC and other broadcast outlets. Investment Week awarded him best ETF Eesearch and best FX Research in 2016 and 2017, respectively. James is currently an investment strategist at CoinShares, writing research white papers on investment themes, identifying investment opportunities and helping investors understand the digital asset world.