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Crypto Investment Products See $435M Outflow Amid Market Uncertainty

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Crypto Investment Products See $435M Outflow Amid Market Uncertainty

  • Ether investment products also saw $38M leave, marking their ninth week of negative flow. 
  • Investors worry over U.S. stagflation—a slowing economic growth rate and sticky inflation.

According to CoinShares’ reporting, crypto investment products had a $435 million outflow for the week ending April 26. As the price of Bitcoin is stuck around the low $60,000 level, crypto exchange-traded products (ETPs) have seen withdrawals for three weeks in a row.

With $423 million leaving the market after the halving event, Bitcoin funds were the most active in the outflows category. Ether investment products also saw $38 million leave, marking their ninth week of negative flow. The Solana ETP had a net influx of $4.1 million, while the Litecoin ETP saw a net inflow of $3.1 million.

With $126 million in inflows last week compared to $254 million the week before, CoinShares claims that “deceleration in inflows from new issuers” is to blame for the negative outflows.

All Eyes on Federal Reserve

Farside Investors data shows that last week, IBIT, BlackRock’s Bitcoin exchange-traded fund, saw “zero flows” for the very first time. As withdrawals from Grayscale’s GBTC have slowed, some issuers have had days with no inflows at all in the last several weeks.

Investors’ worries about U.S. stagflation—a slowing economic growth rate and sticky inflation—are probably to blame for the negative outflows, which in turn reduce the likelihood of the Fed cutting interest rates.

At the time of writing, traders are pricing the chances of a June rate decrease at only 11.3% according to the CME FedWatch tool. In comparison, the odds for September and November are 44.8% and 43.8%, respectively.

Market watchers are placing their bets on the US Federal Reserve keeping interest rates unchanged in May and June, with a potential rate decrease coming later in the year.

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Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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