Short-Bitcoin products gain popularity as clampdown-driven crypto outflow persists Short-Bitcoin products gain popularity as clampdown-driven crypto outflow persists
Bitcoin investment products dominated the outflows recorded last week, with $45 million outflows.
2 min read
Updated: Sep. 18, 2023 at 4:12 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Crypto investment products have seen a trend of outflows for five consecutive weeks, as $54 million exited these products in the past week, according to the latest CoinShares weekly report. This extends the total outflow over the last nine weeks to $455 million, underscoring the prevailing bearish sentiment in the market.
US top outflows
CoinShares noted that the United States dominates the outflows, contributing around 77% of these exits due to the seemingly unending regulatory clampdown on crypto-related businesses within the region.
U.S. financial regulatory bodies, including the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), have initiated enforcement actions against various crypto entities such as Binance and Coinbase, as well as decentralized finance protocols like Opyn and Deridex.
These regulatory measures have created a challenging environment for crypto companies operating in the United States, as the regulatory landscape remains unclear.
Short-BTC products are ‘most loved’
CoinShares dubbed short-Bitcoin investment products the “most loved,” even though it experienced outflows of $3.8 million in the past week. The company reports that these products have garnered approximately $12 million in inflows for the current month.
Conversely, BTC investment products bore the brunt of last week’s outflows, accounting for 85% of the total at roughly $45 million. Their monthly performance shows a significant negative trend, with withdrawals exceeding $100 million, indicating a consistent exodus of investors.
In a surprising twist, Ethereum, despite its attractive investment opportunities and strong demand for its staking yields, witnessed an outflow of $4.8 million last week. CoinShares had previously categorized this digital asset as the “least loved” among investors.
Despite the prevailing bearish sentiment, select altcoins managed to attract inflows. Solana, Cardano, and XRP recorded inflows of $0.7 million, $0.43 million, and $0.13 million, respectively.
Nonetheless, flows into digital asset products remain positive throughout the year, as it currently stands at $51 million on the year-to-date metric.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Ethereum
$3,335.76
Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (DApps).
Solana
$251.026
Solana is a high-performance blockchain platform that utilizes a unique consensus algorithm called “Proof of History” to achieve fast transaction speeds and low fees.
XRP
$1.11051
Theย XRP Ledgerย is a decentralized cryptographic ledger powered by a network of peer-to-peer servers.