- CoinShares reports crypto ETPs lost $240M last week in outflows.
- The reason for these outflows was the wave of new trade tariffs from the US that shook the financial markets.
- Bitcoin ETPs took the hardest hit, losing $207M in outflows last week, says CoinShares.
Last week, the crypto space faced a fresh wave of selling pressure. According to new insights from CoinShares, crypto-based exchange-traded products (ETPs) saw a staggering $240 million in outflows.
This trend reversed a two-week streak of inflows, with the mass exodus largely attributed to investor concerns over the United States’ new trade tariffs. Despite this pullback, digital asset ETPs continue to remain resilient, with total assets under management holding firm around $133 billion.
Trade Tariffs Shake Investor Confidence
The reason for these outflows was the wave of new trade tariffs from the US that shook the financial markets. Investors continue to fear that these tariffs could spark a full-blown trade war and disrupt supply chains.
In this environment that is now muddied by uncertainty, many investors are pulling their capital out of risk assets, including crypto ETFs. According to recent insights from James Butterfill, head of research at CoinShares in a recent report:
“The renewed outflows likely reflect investor caution in response to global trade tariffs imposed by the United States and concerns over their potential threat to global economic growth.”
This means that the ripple effects of events in the macroeconomic space often spill into the digital asset industry. This is especially true when traditional investors become heavily invested in the crypt space (as we saw with the crypto ETF market).
Last week’s data from CoinShares appears to now be reinforcing how sensitive the crypto space is, to macroeconomics as a whole.
Bitcoin Takes the Hardest Hit
Per the CoinShares report, Bitcoin-based ETPs suffered the worst outflows last week, after losing $207 million. This sharp exit of liquidity turned Bitcoin’s monthly flow numbers negative for the first time time year. It also erased the gains the cryptocurrency had managed to scrape up over the previous weeks.
While the short-term picture looks bearish, YTD inflows into the Bitcoin ETP space still stand at a healthy $1.3 billion. This shows that investor interest in the flagship cryptocurrency remains strong over the longer term despite the short-term dips. Another interesting thing about this CoinShares report is that the short Bitcoin ETPs (which often thrive when prices crash) haven’t gained much favor.
These products only saw a meager $26 million in YTD outflows, despite minor inflows last week. To put things into perspective, investors are cautious instead of being outright bearish.
Ethereum and Altcoins See Mixed Flows
Another interesting aspect of this report is how Ethereum-linked investment products also faced pressure. They saw $38 million in outflows over the last week. However, despite this setback, they still hold around $279 million in YTD inflows.
Therefore, Ethereum investors are just like Bitcoiners in that they are still interested, however bearish the market has become. Other altcoins saw similar results, although the altcoin market was more mixed. For example, Solana and Sui saw respective outflows of $1.8 million and $4.7 million.
On the other hand, Toncoin saw $1.1 million in new investments, meaning that investors are looking to diversify into smaller-cap tokens that may be less correlated with Bitcoin (and the rest of the bloodied-up financial market). Overall, Grayscale Investments led the pack in terms of capital outflows.
The company saw around $95 million worth of assets withdrawn over the last week, bringing its total YTD outflows to a bitter $1.4 billion. This continues the trend of outflows that grayscale has suffered since the launch of its spot Bitcoin ETFs earlier this year.
