Last week, it suddenly overturned US Bitcoin and Ethereum Exchange Trade Funds (ETFs), dropping more than $1.7 billion.
This shift occurred amidst the volatility of Bitcoin and Ethereum prices over the past week as both assets flowed over 8% during the reporting period.
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Bitcoin and Ethereum ETFS bleed cash in market volatility
According to SoSovalue data, the Spot Bitcoin ETF recorded $903 million in net withdrawals. The outflow concluded a month-long influx streak that reflected increased institutional confidence.
That sentiment has deepened macroeconomic uncertainty and encouraged many institutional investors to settle their exposure and adopt a defensive attitude.
Ethereum products reflected a recession, but withstanded heavier losses.
Data from SOSOValue shows that nine US listed Spot Ethereum ETFS saw redemption and showed a $796 million spill. This is their biggest weekly withdrawal since it was launched earlier this year.
Synchronized retreats across both assets reflect a broader cooling in crypto ETF demand.
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Agency allocators once saw these vehicles as convenient entry points for digital assets. They are now reevaluating their strategies in light of macro headwind growth.
Over the past week, sustained inflation concerns, slowing global growth, and increasing uncertainty around US monetary policy have reduced the desire for volatile assets. In this environment, digital assets (classified as high risk) were one of the first biases from the portfolio.
Meanwhile, institutional strategies have also become more defensive, especially as investors are increasingly exposed to losses.
Encrypted data shows that Bitcoin finance companies raising capital through pipe transactions are under pressure as stock prices tend to trend towards discounted issuance levels.
At the same time, investors’ attention is spinning towards newly launched ETFs related to alternative tokens such as Solana and XRP.
These vehicles draw capital from Bitcoin and Ethereum funds, introduce fresh competition and encourage experimentation with undervalued assets.
The redirection of influx suggests that while risk sentiment has cooled, appetite for diversification within the code remains active.
