Digital Asset Products See Largest Outflows Last Week: Report


Outflows of digital asset investment products hit a stunning record high of $423 million last week amid a deep market dump, according to Bitcoin ETF provider ProShares. The amount rose sharply from the previous largest outflow of $198 million in January this year.

Through June 24 data, the year-to-date (YTD) net flow for these products sits at -$21 million, and digital assets under management by financial service providers have reached around 36.2 billions of dollars altogether.

Most important weekly releases

The official Proshares blog post indicated that the volume of withdrawals from digital asset investment products has massively escalated as the market sell-off has continued over the past two weeks, driving down the major cryptocurrency below $18,000 at some point. The wider impact of the landfill was revealed through data collected last week, Proshares noted.

“The outflow occurred on June 17, but was reflected in last week’s numbers due to trade reporting delays, and likely responsible for Bitcoin’s decline to $17,760 over the weekend.”

When tracking outflow/inflow amounts by asset, Bitcoin saw net outflows totaling $453 million last week, offsetting nearly all of the inflows since the start of the year. BTC’s total assets under management (AuM) had thus fallen to $24 billion, the lowest point since the start of 2021.

It is worth mentioning that with the latest launch of the first-ever Short Bitcoin Futures ETF in the US last week, products betting on the asset falling in value attracted an influx of $15 million.

By comparison, Ethereum-related products saw net inflows of $11 million, ending 11 consecutive weeks of outflows.

Another noteworthy fact is that the very first Bitcoin ETF listed in North America – Purpose Bitcoin ETF (BTCC), saw an outflow of 24,510 BTC on June 17, reducing its AuM by almost 51%. This made Canadian exchanges responsible for $487 million in outflows over the past week.

Other implications

The largest weekly volume of withdrawals from digital asset funds shows investors were abandoning cryptocurrency-related financial products as pessimistic sentiment continues to cloud the crypto market. Although the major cryptocurrency rebounded quickly after hitting around $17,500, it still failed to reclaim the $22,000 line.

Since a fundamental shift in market conditions is not yet in sight, digital asset commodities are likely to come under pressure as investors tend to adopt a risk-taking attitude. Given that the Fed is committed to raising rates to combat runaway inflation, these products could continue to see significant outflows until a structural change occurs in the macroeconomic environment.


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