Crypto funds hit by $1b outflows amid market volatility: CoinShares

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As a seasoned crypto investor with over a decade of experience in this volatile market, I’ve seen my fair share of bull and bear runs. Last week’s market jitters, triggered by the Federal Reserve’s hawkish stance, reminded me of the old saying: “Buy on the rumor, sell on the news.

At the close of the previous week, various crypto investment funds experienced an overall withdrawal of approximately $1 billion. This outflow included a significant one-day withdrawal amounting to about $576 million. The withdrawals occurred as the markets grew anxious due to the Federal Reserve adopting a more aggressive stance.

Last week, there was an inflow of approximately $308 million into digital asset investment products, but during the last two days, there were outflows totaling $1 billion, with $576 million withdrawn on December 19th, as per data gathered by CoinShares.

On their Monday blog, a company based in Jersey announced that significant withdrawals occurred following investor responses to the Federal Reserve’s more aggressive monetary policy stance. This withdrawal led to a decrease in assets managed for digital asset exchange-traded products by $17.7 billion, which is equivalent to a 0.37% drop in total assets under management. This outflow represents the 13th largest single-day withdrawal recorded, according to James Butterfill, the head of research at CoinShares.

As a crypto investor, I’ve noticed that Bitcoin (BTC) stood strong, attracting approximately $375 million in net inflows during the past week. Ethereum (ETH), too, experienced inflows amounting to $51 million. However, these gains for ETH seem to have come at a cost for Solana, which saw about $8.7 million in outflows.

Investment products involving multiple assets experienced the most significant setbacks, resulting in a net outflow of approximately $121 million. Despite this, there was ongoing curiosity towards alternative cryptocurrencies, as evidenced by positive inflows for XRP ($8.8 million), Horizen ($4.8 million), and Polkadot ($1.9 million).

Bitcoin’s value dips below the $100,000 mark due to its struggles staying afloat, with a brief drop to around $95,000. This decline led to a massive liquidation event worth approximately $1.4 billion, as reported by CoinGlass, which eliminated leveraged long positions over a 24-hour period.

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2024-12-23 17:12