The digital asset investment products experienced outflows for the fourth consecutive week, totaling $251 million. This trend indicates a bearish sentiment in the market, with investors pulling out their funds. One notable aspect was the “measurable outflows” from newly issued ETFs in the US, amounting to $156 million last week. This suggests that investors are wary of the current market conditions and are opting to divest their holdings.
Bitcoin remained the primary focus in the digital asset market, with outflows totaling $284 million. It is not surprising that Bitcoin was the only digital asset to see outflows, given its volatile nature. The average purchase price of ETFs since their launch was estimated to be $62,200 per bitcoin. Speculation from a Singaporean asset manager suggested that the price drop below this level may have triggered automatic sell orders, leading to further outflows.
While Bitcoin saw significant outflows, Ethereum broke its seven-week spell of outflows and attracted $30 million in inflows last week. This indicates a shift in investor sentiment towards altcoins. Various altcoins such as Avalanche, Cardano, and Polkadot also saw inflows, with investment products designed to provide exposure to these assets receiving millions in inflows. Solana and Litecoin also received modest inflows, signaling investor interest in a diverse range of digital assets.
Regionally, outflows were mainly concentrated in the United States, recording $504 million in outflows. This suggests that US investors are currently pulling back from digital asset investments. Sweden also witnessed significant outflows of $30.3 million. Other countries such as Canada, Switzerland, and Germany also experienced weekly outflows, indicating a broader trend of negative sentiment in the market. However, Brazil deviated from this trend and saw inflows of $3.7 million, showing that there are still pockets of positive sentiment in the global market.
One positive highlight from last week was the successful launch of spot Bitcoin and Ethereum ETFs in Hong Kong. These ETFs attracted almost $307 million in inflows in the first week of trading, indicating strong investor interest in these products. The launch of these ETFs in Hong Kong may serve as a catalyst for further investment inflows in the region, providing a positive outlook for the digital asset market in Hong Kong.
Overall, the recent trends in digital asset investment products paint a nuanced picture of the market. While Bitcoin continues to dominate investor focus, altcoins are gaining traction, and regional variations in investment sentiment are evident. The launch of new ETFs and positive inflows in specific regions offer hope for a more diverse and resilient digital asset market in the future.
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