Digital Assets See Largest Outflows Since March

Takeaways

• Digital asset investment products saw outflows totalling US$168m, the largest outflow since the US regulatory crackdown of exchanges in March 2023.
• Bitcoin was the primary focus, seeing outflows last week totalling US$149m.
• Many investors are continuing to sell their short positions, seeing US$4m outflows last week, with the last 18 week run of outflows representing 89% of total AuM

Digital asset investment products saw outflows totalling US$168m, the largest outflow since the US regulatory crackdown of exchanges in March 2023. This August’s outflows now total US$278m in what has been an exceptionally low trading volume market, with investment products trading US$1.3bn for the week, 16% below the year average. This negative sentiment we believe is due to the increasing acceptance that a spot-based ETF for Bitcoin in the US is likely to take longer than many expect, with recent delays being announced by the SEC.

The outflows were spread across most geographies, highlighting the negative sentiment is broad-based. Germany and Canada, where most of activity has been in recent months, saw outflows of US$68m and US$61m respectively.

As usual, Bitcoin was the primary focus, seeing outflows last week totalling US$149m. Regardless, on a net basis flows remain positive for the year at US$265m. Many investors are continuing to sell their short positions, seeing US$4m outflows last week, with the last 18 week run of outflows representing 89% of total assets under management (AuM).

Ethereum was the only altcoin to see measurable outflows, totalling US$17m. While XRP and Litecoin saw minor inflows of US$0.5m and US$0.44m respectively.
 

Contact James Butterfill at [email protected]