Research Summary
The report discusses the recent trends in digital asset fund flows, highlighting a trend of outflows from Bitcoin and Ethereum, despite their perceived investment potential. It also notes that some altcoins like Solana, Cardano, and XRP are seeing inflows, while blockchain equities continue to experience outflows.
Key Takeaways
Outflows in Digital Asset Investment Products
- Continued Outflows: Digital asset investment products have seen outflows for 8 out of the last 9 weeks, totaling US$455m.
- Regional Impact: The US has been the primary focus of this negative sentiment, accounting for 77% of the outflows. Germany, Canada, and Sweden also continue to experience outflows.
- Volume Increase: Despite the outflows, volumes picked up slightly to US$1bn for the week, up 42% compared to the prior week.
Bitcoin and Ethereum Outflows
- Bitcoin’s Dominance: Bitcoin comprised 85% of the outflows, seeing US$45m last week. However, it remains the most loved investment product with month-to-date inflows at US$12m.
- Ethereum’s Outflows: Despite attractive investment fundamentals and high demand for its staking yield, Ethereum saw outflows totaling US$4.8m last week.
- Other Altcoins: Other altcoins, such as Binance and Polygon, saw minor outflows of US$0.3m each.
Inflows in Select Altcoins
- Altcoins Bucking the Trend: Some altcoins continue to buck the trend, with Solana, Cardano, and XRP all seeing inflows of US$0.7m, US$0.43m, and US$0.13m respectively.
- Blockchain Equities: Blockchain equities also saw its 6th consecutive week of outflows, totaling US$9.6m last week.
Actionable Insights
- Monitor Bitcoin and Ethereum: Despite the recent outflows, Bitcoin and Ethereum remain significant players in the digital asset space. Their performance could indicate broader market trends.
- Investigate the Potential of Altcoins: Altcoins like Solana, Cardano, and XRP are seeing inflows despite the broader market trend. These could present opportunities for diversification.
- Consider Regional Factors: The US has been the primary focus of the negative sentiment, which could have implications for investment strategies in the region.
