Crypto funds saw massive withdrawals, amounting to about $305 million over the past week. The decline was driven by negative investor sentiment across various cryptocurrencies, with Bitcoin (BTC) and Ethereum (ETH) experiencing the biggest withdrawals.
According to CoinShares' latest report, crypto funds recorded significant capital outflows last week, with total withdrawals reaching $305 million. The move is indicative of a broader trend of negative sentiment surrounding the digital asset market.
The report emphasized that these withdrawals mostly came from crypto funds based in the United States, which saw withdrawals of $318 million. In contrast, smaller markets such as Switzerland and Canada recorded small inflows of $5.5 million and $13 million respectively.
Most of this production was focused on Bitcoin, which accounted for $319 million. This sharp decline in investment coincided with economic data suggesting a lower likelihood of interest rate cuts by the Federal Reserve.
Ethereum, the second largest cryptocurrency by market capitalization, also felt the impact with withdrawals totaling $5.7 million. Trading volume for Ethereum remained flat, reaching only 15% of the level seen during the ETF's launch week in the United States. This indicates a waning interest among traders and investors, coinciding with a decline in overall market activity.
Other cryptocurrencies such as Solana recorded inflows, indicating selective investor interest in alternative assets. However, the focus is still on major players such as Bitcoin and Ethereum, which dominate market sentiment and investor strategies.
Against the downward trend in crypto funds, blockchain-specific equities are seeing increased investor interest. An investment in a product specifically for Bitcoin miners led to an inflow of $11 million.
Additionally, Bitcoin miner revenue in August plunged to a one-year low of $827.56 million, a 57% drop from the March 2024 peak. This decline coincided with reduced mining output and increasing operational challenges after the halving.
At the time, the price of BTC was trading at $58,259, marking a decrease of 8.48% in 7 days. The turnover in 24 hours increased by 79.92% to $28.77 billion. Despite this week's sharp decline, the current market cap remains at $1.15 trillion, reflecting a small increase of 0.72%.
Additionally, the price of ETH is $2,519.46, also down 8.02% over the past seven days.