13-6-2023 (LONDON) On June 12, CoinShares, a European cryptocurrency investment firm, released its weekly “Digital Asset Fund Flows Report,” revealing that cryptocurrency investment products faced significant outflows of $88 million in the past week. This adds to the ongoing trend of eight consecutive weeks of outflows, which now total $417 million. Analysts at CoinShares attribute this trend to the impact of monetary policy, as investors remain cautious amidst the continuous rise in interest rates.
Ether, the second-largest cryptocurrency by market capitalization, witnessed the largest weekly outflows since the Ethereum Merge in September 2022, with $36 million exiting Ether investment products. Bitcoin, the leading cryptocurrency, also experienced outflows of $52 million during the analyzed period. This brings the cumulative outflows for Bitcoin over the past eight weeks to $254 million, which accounts for approximately 1.2% of the total assets under management (AUM). Additionally, short-Bitcoin products saw outflows of $1.1 million, with a total of 44% of AUM exiting these products over the past seven weeks.
Altcoins, or alternative cryptocurrencies, showed mixed performance during this period. Minor inflows were observed for Litecoin, XRP, and Solana, while Polygon experienced outflows. CoinShares’ report author, James Butterfill, noted that altcoins have seen overall inflows year-to-date, except for Tron, which contrasts with the outflows witnessed by Bitcoin and Ethereum.
Significantly, 87% of the outflows were concentrated within a single provider, indicating a regional impact. Most of these outflows originated from North America, while Switzerland saw minor inflows of $9.2 million. However, Germany experienced outflows of $9.4 million. Despite regulatory pressures and concerns surrounding the cryptocurrency sector, the digital asset market has displayed remarkable resilience, with the total crypto market maintaining a market capitalization of over $1 trillion. The resilience shown by altcoins suggests that investors have diversified their exposure to cryptocurrencies, despite concerns over regulatory crackdowns on assets classified as securities.
