Volume 221: Digital Asset Fund Flows Weekly Report

From CoinShares Research Blog by James Butterfill

Hawkish FED rhetoric and CPI release prompt US$415m outflows

Digital asset investment products saw their first significant outflows, totalling $415m, following an unprecedented 19-week post-US election inflow streak that amassed $29.4bn — far surpassing the $16bn recorded in the first 19 weeks of US spot ETF launches that began in January 2024. We believe these outflows were triggered by the Congressional meeting with Fed Chair Jerome Powell, who signalled a more hawkish monetary policy stance, coupled with US inflation data exceeding expectations.

The majority of outflows originated in the US, totalling $464m, with most other countries remaining largely unaffected by the news. Notable inflows were recorded in Germany ($21m), Switzerland ($12.5) and Canada ($10.2m).

Bitcoin, highly sensitive to interest rate expectations, bore the brunt of investor outflows, totalling $430m last week. Interestingly, there were no corresponding inflows into short-Bitcoin products, which instead saw outflows of $9.6m.

Solana saw the largest inflows of any asset, totalling US$8.9m, closely followed by XRP and Sui with inflows of US$8.5m and US$6m respectively.

Blockchain equities also saw inflows of US$20.8m, bringing year-to-date inflows to US$220m.