Negative Sentiment Persists for Digital Asset Investments

Takeaways

• Digital asset investment products saw outflows totalling US$9.7m, highlighting continued mild negative sentiment that has persisted for the last 3 weeks.
• Bitcoin saw minor outflows, totalling US$6.5m, for the 3rd week in a row implying sentiment at the beginning of 2023 remains negative. Over the same period short-bitcoin investment products saw minor inflows of US$1.2m.
• XRP bucked the trend with inflows totalling US$3m representing 9% of total AuM. We believe due to the improving clarity on its legal case with the SEC.

Digital asset investment products saw outflows totalling US$9.7m, highlighting continued mild negative sentiment that has persisted for the last 3 weeks. During the week total assets under management (AuM) fell to their lowest since the FTX collapse to US$20.5bn but have since recovered.

Trading volumes remain low with Bitcoin volumes averaging US$5bn a day during the week compared to US$9bn during 2022, while exchange traded products averaged US$173m per day. Regionally, Germany and Switzerland saw minor inflows of US$0.6m and US$0.8m respectively while the negative sentiment was focused in Brazil and the US with outflows totalling US$4.5m and US$4.1m respectively.

Bitcoin saw minor outflows, totalling US$6.5m, for the 3rd week in a row implying sentiment at the beginning of 2023 remains negative. Over the same period short-bitcoin investment products saw minor inflows of US$1.2m.

Ethereum continued with its negative streak, seeing minor outflows of US$3m, marking its 8th consecutive week of outflows.

XRP bucked the trend with inflows totalling US$3m representing 9% of total AuM. We believe the improving clarity on its legal case with the SEC is being seen as increasingly favourable for XRP by the investment community.

Contact James Butterfill at [email protected]