Crypto Funds Hemorrhage $2B In A Week, Biggest Rout Since February As Fear Reigns
Crypto investment products hemorrhaged $2 billion in outflows last week, their largest weekly loss since February, according to CoinShares.
The withdrawals mark the third straight week of negative flows, bringing total outflows over the period to $3.2 billion, CoinShares said in a Nov. 18 report. The selloff has seen total assets under management for crypto products slump 27% to $191 billion from the peak in early October.
CoinShares analysts said the sharp outflows and falling prices reflect a broader “risk-off” shift among investors amid policy uncertainty and aggressive whale selling. Market fear has deepened, with the Crypto Fear & Greed Index plunging to 14 out of 100, signaling “extreme fear.”
US Sees The Biggest Outflows
The US accounted for the majority of the outflows seen in the past week, with $1.97 billion leaving products in the US during this period. Switzerland and Hong Kong came in at second and third with their much lower outflows of $39.9 million and $12.3 million, respectively.
Meanwhile, products in Germany managed to record $13.2 million in inflows as local investors likely took the opportunity to buy the dip.
Looking at the outflows on a per-crypto basis, Bitcoin products took the biggest dollar hit in this regard after $1.38 billion was withdrawn. This comes after US spot Bitcoin ETFs (exchange-traded funds) saw $1.1 billion outflows last week.
Data from Farside Investors shows that the US spot BTC ETFs are on a three-day outflows streak.
US spot BTC ETF flows (Source: Farside Investors)
Their biggest outflows during this period happened on Nov. 13, when investors pulled $866.7 million from the funds. On the day, Grayscale’s BTC suffered the biggest outflows of $318.2 million, while BlackRock’s IBIT came in second with its $256.6 million outflows.
Overall, BTC investment products have seen their collective AUM drop by 2% in the past three weeks.
Ethereum products saw the largest outflows on a proportional basis after $687 million outflows last week, representing 4% of the products’ total AUM, according to the CoinShares report.
Multi-asset investment products, however, attracted $69 million in inflows over the past three weeks. Short-Bitcoin products saw renewed interest recently as well, likely as traders tried to position themselves defensively amid the downturn.
Crypto Market Slump Sees Investors Turn Risk Off
The continued withdrawals from crypto investment products coincided with a steep drop in prices across the broader digital asset market.
Those price drops have forced the crypto market’s capitalization down over 12% since the start of November, according to TradingView data.
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