Market Bleeds Funds: Bitcoin Leads Exits
Last week, crypto funds experienced a significant outflow of $600 million, following a massive inflow of $2 billion in the previous week. This marks the end of a five-week streak of inflows totaling $4.35 billion, according to data from CoinShares. The outflow recorded is the largest since March 22, 2024, under similar circumstances. The March 22 outflow followed significant inflows of $3 billion the week before. Investors pulled out due to the outcome of the FOMC meeting, moving their exposure to more stable assets.
– Outflows of $600 million recorded last week
– End of a five-week inflow streak totaling $4.35 billion
– Largest outflow since March 22, 2024
– Investors pulled out due to FOMC meeting outcome
The recent FOMC meeting on June 11 and 12, 2024, held interest rates steady at 5.25%-5.50%, prompting many crypto investors to withdraw. Crypto is considered a risky, speculative asset, leading investors to seek safer havens amidst high-interest rates.
– FOMC meeting on June 11 and 12, 2024
– Interest rates held steady at 5.25%-5.50%
– Investors seek safer havens
– Crypto viewed as a risky asset
Notably, the majority of outflows came from Bitcoin, with crypto funds for the leading asset experiencing a $621 million loss. Most of the Bitcoin outflows were seen in Spot Bitcoin ETFs in the US. Spot Bitcoin ETFs recorded outflows every day last week, except for a minor inflow on June 12. Consequently, these ETFs saw total outflows of $580 million. Negative investor sentiment towards Bitcoin was also evident in short Bitcoin products receiving $1.8 million in inflows.
– Majority of outflows from Bitcoin
– Spot Bitcoin ETFs in the US affected
– Total outflows of $580 million
– Negative sentiment reflected in short Bitcoin products
Solana also faced challenges last week, with $0.2 million in outflows from its investment products. Multi-asset products saw outflows of $1.1 million, while trading volume averaged $11 billion, well below the yearly average of $22 billion. As a result, total assets under management (AuM) decreased from over $100 billion to $94 billion.
– Solana recorded $0.2 million in outflows
– Multi-asset products with outflows of $1.1 million
– Trading volume below yearly average
– Total AuM decreased to $94 billion
However, Ethereum received $13.1 million in outflows as interest grew in anticipation of the launch of Spot Ethereum ETFs. Other cryptocurrencies like BNB, Litecoin, XRP, Chainlink, and Cardano saw inflows of $0.3 million, $0.8 million, $1.1 million, $0.7 million, and $0.8 million, respectively.
– Ethereum received $13.1 million in outflows
– Anticipation for Spot Ethereum ETFs
– Inflows for BNB, Litecoin, XRP, Chainlink, and Cardano
– Diversification in crypto investments
Closing Thoughts 🌟
In conclusion, the cryptocurrency market experienced significant outflows last week, primarily driven by Bitcoin. The FOMC meeting’s outcome and high-interest rates prompted investors to seek more stable assets, leading to the largest outflow since March. While Bitcoin faced substantial outflows, other cryptocurrencies saw varied responses, including inflows for certain assets. The market’s reaction underscores the importance of external factors in influencing crypto fund flows and investor sentiment.
Sources:
– CoinShares data
– Bitcoinist
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