After experiencing several weeks of gains, investors pulled out close to $1 billion from crypto investment products last week. A new report from CoinShares revealed that $942 million exited funds that offer exposure to popular cryptocurrencies like Bitcoin, Ethereum, Solana, and Cardano. The report attributed this hesitancy among investors to record net outflows, with Bitcoin’s price dip being a significant factor in the decision to pull out funds. Despite the recent outflows, Bitcoin’s price managed to surge above $70,000, showing resilience in the face of investor withdrawals.
The focus was primarily on Bitcoin, with large amounts of money exiting Grayscale’s newly converted exchange-traded fund (ETF), GBTC. Investors have been redeeming shares from the ETF since it transitioned from a closed-end fund in January. Additionally, cash also flowed into other Bitcoin ETFs like BlackRock’s iShares Bitcoin Trust and Fidelity Wise Origin Bitcoin Trust, indicating ongoing interest in cryptocurrency investment products. In Europe, crypto funds offering exposure to altcoins also experienced significant outflows, showcasing a broader trend of investor caution in the market.
Prior to the recent outflows, investors had been injecting cash into crypto investment products for seven consecutive weeks. Newly approved spot Bitcoin ETFs, given the green light by the Securities and Exchange Commission in January, had gained popularity among investors. Despite the recent withdrawals, the overall sentiment towards cryptocurrency investments remains positive, with Bitcoin’s price showing resilience and hovering around the $70,000 mark.
