In a dynamic turn of events, the cryptocurrency market has witnessed a notable shift, with Bitcoin experiencing outflows totaling $25 million amidst the heightened volatility spurred by Spot Bitcoin ETFs. Notably, CoinShares’ latest ‘Digital Asset Fund Flows Weekly Report sheds light on this intriguing trend, revealing a nuanced perspective on the market movements.
Bitcoin Notes $25 Mln Outflows
Digital asset investment products encountered notable outflows last week, amounting to about $21 million. However, beneath this headline figure lies a fascinating revelation – an immense trading volume of $11.8 billion in Bitcoin, marking a sevenfold increase from the typical weekly trading activity observed in 2023.
However, the largest crypto by market cap, Bitcoin witnessed a weekly outflow of $24.7 million last week, the report showed.
Notably, this surge in trading activity signifies a pivotal role played by ETFs, contributing to 63% of all Bitcoin volumes on trusted exchanges. In addition, the CoinShares report emphasizes the divergence in the fortunes of incumbent, higher-cost issuers and newly launched ETFs.
For instance, the former (Incumbent) witnessed significant setbacks, with $2.9 billion in outflows since the inauguration of spot-based ETFs on January 11, 2024. In contrast, the latter (Newly Issued ETFs) attracted a noteworthy $4.13 billion in inflows, showcasing a shift in investor preference towards cost-effective alternatives.
Also Read: Ethereum Foundation Swaps $1.6 Mln ETH For DAI Amid $120 Mln Whale Selloff
Regional Dynamics and Altcoin Struggles
Examining the regional landscape, the US emerged as a hub for cryptocurrency inflows, recording $263 million. In contrast, Canada and Europe faced a combined outflow of $297 million. This regional shift suggests a migration of assets to the US, driven by its more competitive fee structures.
Notably, altcoins, including Ethereum and Solana, faced challenges during this period. Ethereum witnessed outflows of $14 million, while Solana experienced $8.5 million in outflows, underscoring a broader market trend.
Considering that, several analysts believe that the cryptocurrency landscape is undergoing a transformative phase, shaped by the rising influence of ETFs, shifting investor preferences, and regional dynamics. The market’s response to these factors sets the stage for a dynamic and evolving crypto landscape in the weeks to come.
Notably, the market has noted a selling pressure lately, due to several macroeconomic factors and other related hurdles. Notably, the Bitcoin price was down 2.08% to $40,862,99 during writing on January 22, while its trading volume over the last 24 hours soared 86% to $18.14 billion.
On the other hand, the Ethereum price decreased by 3.82% to $2,376.14 during writing, with its trading volume soaring 93% to $9.01 billion. The Solana price was down around 5% to $88.73.
Also Read: BitMEX’s Arthur Hayes Predicts Bitcoin (BTC) Price Dump Below $40,000
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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