Ethereum has hit a new low, becoming the worst-performing digital asset investment product of the year. According to CoinShares, Ethereum experienced its largest outflow since August 2022, with $61 million exiting last week.

Digital asset investment products have faced a rough patch, with last week marking the third consecutive week of outflows. A total of $30 million left the market, reflecting a persistent negative trend.

Source: CoinShares

Despite some providers experiencing minor inflows, the market was heavily impacted by Grayscale, which saw outflows of $153 million.

Trading volumes did rise by 43% week-on-week to $6.2 billion, but this figure is still below the $14.2 billion weekly average for the year.

Regional breakdown of inflows and outflows

The regional analysis shows a mixed picture. The US led with $43 million in inflows, followed by Brazil and Australia with $7.6 million and $3 million respectively.

However, several regions saw massive outflows. Germany faced $29 million in outflows, Hong Kong $23 million, Canada $14 million, and Switzerland $13 million.

Source: CoinShares

On the flip side, some digital assets saw positive movements. Multi-asset and Bitcoin ETPs led the inflows with $18 million and $10 million, respectively.

Interestingly, short-bitcoin products saw outflows totaling $4.2 million last week, indicating a possible shift in sentiment. Altcoins like Solana and Litecoin also witnessed inflows, with Solana receiving $1.6 million and Litecoin $1.4 million.

QCP Capital shared some interesting insights on the current market dynamics. They noted that Bitcoin started the second half of the year with a strong surge from the $60k region to $63.7k, following a false break below the $60k support level.

This movement was supported by recovering BTC spot ETF inflows, which saw $73 million of net inflows last Friday, the highest daily inflow in two weeks.

Source: TradingView

According to QCP, looking at seasonality, Bitcoin has a median return of 9.6% in July and tends to rebound strongly, especially after a negative June. Last month, Bitcoin experienced a negative return of -9.85%, so signs are pointing towards a bullish July.

Their options desk also noted flows positioning for an upside move last Friday into the month-end, potentially in anticipation of the Ethereum spot ETF launch. This optimism suggests that investors are getting ready for a potentially profitable month.

For traders looking to capitalize on these trends, QCP Capital suggested a BTC accumulator with an expiry of 20 September 2024. The trade has a strike price of $59,000 and a barrier of $71,000, with weekly observation frequency.

The spot reference for BTC/USD is $63,000. This trade idea banks on the bullish momentum and seasonality patterns that Bitcoin often sees in July.

Jai Hamid