TL;DR
- Market Reversal: Digital asset products saw $454m in outflows, driven by fading expectations of a March Federal Reserve rate cut and a $1.3bn four‑day outflow streak that nearly erased early‑year inflows.
- Regional Split: The U.S. recorded $569m in outflows, while Germany, Canada, and Switzerland posted inflows, showing contrasting global sentiment.
- Asset Divergence: Bitcoin and Ethereum faced heavy outflows, but XRP, Solana, and Sui attracted inflows, revealing selective investor confidence despite broader market caution.
Digital asset investment products faced a sharp reversal in sentiment last week as $454m in outflows erased most of the early momentum seen at the start of the year. The shift followed a four‑day $1.3bn outflow streak, nearly wiping out the $1.5bn in inflows recorded during the first two trading days. The downturn appears closely tied to investor concerns over fading expectations of a Federal Reserve interest rate cut in March after recent macroeconomic data signaled a less supportive environment.
Regional Divergence Highlights Shifting Market Sentiment
The United States stood out as the only region showing negative sentiment, recording $569m in outflows, underscoring how strongly U.S. investors reacted to changing rate expectations. Other regions moved in the opposite direction. Germany posted $58.9m in inflows, while Canada added $24.5m and Switzerland brought in $21m, suggesting that international investors maintained a more constructive outlook despite global uncertainty.
Bitcoin Outflows Dominate Despite Mixed Market Signals
Bitcoin absorbed the largest share of negative flows, with $405m in outflows last week. Interestingly, short‑bitcoin products also saw $9.2m in outflows, creating mixed signals around broader market sentiment. The simultaneous decline in both long and short products suggests investors may be stepping back from directional bets as macroeconomic uncertainty intensifies.
Ethereum and Multi‑Asset Products Extend the Downtrend
Ethereum followed a similar trajectory, recording $116m in outflows, reinforcing the broader cooling across major digital assets. Multi‑asset investment products also saw $21m in outflows, while Binance and Aave products experienced smaller declines of $3.7m and $1.7m, respectively. The pattern reflects a cautious stance across diversified crypto exposure as investors reassess risk.
Altcoins Show Strength With Targeted Inflows
Despite the broader downturn, several altcoins bucked the trend. XRP attracted $45.8m, Solana added $32.8m, and Sui brought in $7.6m, signaling pockets of resilience. These inflows highlight selective investor confidence in assets perceived to have strong ecosystem momentum or differentiated value propositions even amid macro‑driven volatility.
