Digital asset investment products see weekly $446 million net outflow…"Sentiment recovery not yet"

Large weekly outflows from digital asset investment products have continued, and analysts say investor sentiment remains weak despite year-to-date net inflows.

According to CoinShares, a digital asset (cryptocurrency) asset manager, digital asset funds saw a total net outflow of $446 million last week. Since the sharp drop on October 10, cumulative outflows have increased to $3.2 billion. This suggests that investor confidence has not fully recovered despite price rebounds.

However, year-to-date (YTD) fund flows have remained at levels similar to last year. Year-to-date cumulative inflows stand at $46.3 billion, not far from $48.7 billion in the same period of 2024. Assets under management (AuM) increased by only 10% compared with the start of the year, suggesting that average investor returns were limited despite inflows.

By region, the largest share of outflows came from the U.S., where $460 million left. Switzerland also saw $14.2 million withdrawn. In contrast, Germany was an exception, recording a $35.7 million inflow. Germany's cumulative inflows this month totaled $248 million, indicating selective buying that used the recent price weakness as a purchasing opportunity.

Flows by asset were mixed. XRP and Solana recorded weekly net inflows of $70.2 million and $7.5 million, respectively. Since related ETFs were launched in the U.S. in mid-October, cumulative inflows amount to $1.07 billion for XRP and $1.34 billion for Solana. By contrast, Bitcoin and Ethereum saw weekly net outflows of $443 million and $59.5 million, respectively, and cumulative outflows since the ETF launches reached $2.8 billion for Bitcoin and $1.6 billion for Ethereum.

James Butterfill, head of research at CoinShares, said in the report, "Year-to-date inflows are robust, but recent weekly flows show investor sentiment has not fully recovered." He added, "Unlike the broad U.S.-centered outflows, inflows in Germany suggest selective accumulation during the price weakness."