Key Points:
Digital asset investment products saw $206 million outflows for the second consecutive week, with Bitcoin and Ethereum notably affected.
Newly issued ETFs attracted some inflows, but blockchain equities experienced their 11th week of outflows due to concerns over mining post-halving.
Despite slight variations in regional flows, overall sentiment remains cautious amidst expectations of prolonged high-interest rates from the Fed.
Digital asset investment products have encountered outflows for the second consecutive week, amounting to $206 million, while trading volumes in Exchange-Traded Products (ETPs) witnessed a slight dip, totaling $18 billion.
Digital Asset Investment Products Outflows Persist
Notably, this represents a lower proportion of total Bitcoin volumes, standing at 28%, compared to 55% a month ago. Analysts attribute this decline in digital asset investment products to waning interest among ETF investors, likely influenced by expectations of prolonged high-interest rates from the Federal Reserve.
Bitcoin witnessed outflows of $192 million, but there was minimal interest in shorting the cryptocurrency, with short-Bitcoin products experiencing outflows of just $0.3 million.
Ethereum sustained outflows of $34 million, marking its sixth consecutive week of decline. Conversely, multi-asset products saw improved sentiment with inflows of $9 million last week, while Litecoin and Chainlink attracted inflows of $3.2 million and $1.7 million.
In the realm of blockchain equities, outflows persisted for the 11th consecutive week, totaling $9 million, as investors remained concerned about the impact of the halving on mining companies.
ETFs Experience Mixed Flows Amidst Global Trend
The negative sentiment was predominantly observed in US ETFs, with $244 million in outflows, particularly affecting incumbent ETFs. However, newly issued ETFs continued to witness inflows, albeit at a reduced rate compared to previous weeks. Meanwhile, Canada and Switzerland experienced inflows of $30 million and $8 million, while Germany reported minor outflows of $8 million.
CoinShares' recent report highlighted that the average production cost per Bitcoin among listed mining companies post-halving was approximately $53,000, with the hash rate anticipated to reach 700 Exahash by 2025. However, following the halving, a potential 10% decline in hash rate could occur as miners deactivate unprofitable ASICs.
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