Digital Asset Investment Products See $223 Million in Outflows, Snapping 15-Week Inflow Streak

Digital asset investment products have taken a hit, with $223 million in outflows recorded last week. This sudden reversal marks the end of a 15-week streak of inflows, leaving many to wonder what sparked the change. According to a report from CoinShares, the outflows were likely triggered by fears of prolonged higher interest rates and macro volatility, following a hawkish Federal Reserve meeting and stronger-than-expected economic data.

Key Takeaways from the Report

The week started on a positive note, with $883 million in inflows, but investor sentiment quickly shifted. By Friday, outflows had exceeded $1 billion, with Bitcoin leading the way at $404 million. Ethereum, on the other hand, continued to attract capital, with $133 million in inflows. XRP also saw gains, with $31.2 million in inflows, while Solana and SEI brought in $8.8 million and $5.8 million, respectively.

Bitcoin’s Sensitivity to Macroeconomic Shifts

Bitcoin’s sharp pullback highlights its continued sensitivity to macroeconomic shifts. Despite this, year-to-date inflows into Bitcoin products stand at $20 billion, reflecting sustained institutional interest despite the volatility. This suggests that investors remain confident in the long-term potential of Bitcoin, even if they’re taking a step back in the short term.

$1 Billion Flee as Rate Jitters Spark Risk-Off Exodus

The outflows were likely spurred by fears of prolonged higher interest rates, which led to a risk-off momentum taking hold. Weaker payroll data toward the end of the week offered some dovish signals, but they weren’t enough to calm markets. The sudden reversal wiped out a week’s worth of inflows and cut cumulative net gains to $54.18 billion. Total assets under management (AUM) across Bitcoin ETFs dropped to $146.48 billion, equivalent to 6.46% of the cryptocurrency’s total market capitalization.

Ethereum and Other Altcoins See Gains

Ethereum, in contrast, posted a solid week, with $133 million in inflows, its 15th consecutive positive week. This underscores investor confidence in its long-term fundamentals. XRP, Solana, and SEI also saw gains, with $31.2 million, $8.8 million, and $5.8 million in inflows, respectively. Smaller gains were also seen in Aave and Sui, which brought in $1.2 million and $0.8 million.

95% Approval Chance for Spot Solana, XRP ETFs

Bloomberg’s senior ETF analysts have assigned a 95% chance that the SEC will approve spot ETFs for Solana, XRP, and Litecoin this year. This raises their previous odds from 90% amid growing optimism for institutional crypto products. A crypto index ETF tracking multiple assets could also gain approval as early as this week, signaling broader access to altcoins for traditional investors.

Institutional Bitcoin Demand Spreads to Corporate Treasuries

Metaplanet has added another 463 Bitcoin to its growing treasury, pushing the company’s total holdings to 17,595 BTC. At current prices, Metaplanet’s total BTC stash is now worth more than $1.78 billion. The company values the holdings even higher based on market gains, bringing its estimated market value closer to $2.02 billion. This move highlights the growing interest in Bitcoin among institutional investors and corporate treasuries.