TL;DR
- Digital asset investment products have seen a second consecutive week of outflows, with $206 million leaving the market. Bitcoin investment products were hit the hardest, witnessing outflows of $192 million.
- The US ETF market experienced a decline in sentiment, with $244 million in outflows recorded primarily in existing ETFs. However, newly issued ETFs still attracted inflows.
- Despite concerns about the halving’s effects on the blockchain stocks, Bitcoin has registered some gains and is currently trading at around $66,000. Most experts are optimistic about the future, expecting significant increases in the year following the halving event.
Digital asset investment products have experienced a second consecutive week of outflows, with a total of $206 million leaving the market. This decline in investor interest is also reflected in the trading volumes of exchange-traded products (ETPs), which dipped to $18 billion, according to a report from CoinShares.
Bitcoin investment products were hit the hardest, witnessing outflows of $192 million. However, some investors saw this as an opportunity for short-selling, with short-Bitcoin strategies experiencing minor outflows of $0.3 million.
The report also highlighted that ETPs now account for a smaller percentage of total Bitcoin volumes, standing at 28%. This is a significant decrease from the 55% recorded just a month ago, indicating a diminishing appetite among ETP/ETF investors. This could be due to expectations of prolonged high-interest rates by the Federal Reserve (FED).
The US ETF market experienced a decline in sentiment, with $244 million in outflows recorded primarily in existing ETFs. However, newly issued ETFs still attracted inflows, although they were lower than in previous weeks. Canada and Switzerland received $30 million and $8 million in investments, while Germany had a small outflow of $8 million.
Ethereum continued to experience outflows, totaling $34 million for the sixth week in a row. However, multi-asset products had a positive trend, attracting $9 million in investments last week. Additionally, Litecoin and Chainlink received $3.2 million and $1.7 million in investments, respectively.
Blockchain Stocks and the Halving Effect on the Digital Asset Market
In the world of blockchain stocks, worries about the halving’s effects persisted, dampening investor confidence. As a result, blockchain stocks saw their eleventh straight week of money leaving, totaling $9 million.
Despite the initial lack of reaction to the much-anticipated halving event, Bitcoin has since registered some gains. As of now, Bitcoin is trading at around $66,000, up by almost 2% over the past day, according to data from CoinMarketCap.
Some analysts, like those at JPMorgan, have warned of a possible price decrease after this event that occurs every four years. However, most experts are optimistic about the future. Bitwise has pointed out that although prices tend to decrease slightly right after the event, the following year usually brings significant increases.
After the 2012 halving, Bitcoin saw a small 9% rise in value in the month that followed, only to shoot up by an incredible 8,839% in the year that came after. The same kind of trends were seen after the 2016 and 2020 halvings, as Bitcoin’s price surged significantly in the year after each halving event.
According to the CEO of Crypto.com, Kris Marszalek, Bitcoin might face some selling pressure before the upcoming halving event, but the overall outlook for the future is optimistic.
