Key Points
Crypto Market Witnesses Major Outflows
Data from crypto ETP provider CoinShares reveals a significant outflow in the crypto market last week. This was the largest weekly outflow since March, exceeding $725 million. CoinShares’ head of research, James Butterfill, linked this trend to stronger-than-expected macroeconomic data from the previous week. This led to increased speculation about a potential 25 basis point interest rate cut by the U.S. Federal Reserve.
The markets are now closely watching the upcoming Consumer Price Index inflation report. A 50bp cut is more likely if inflation falls short of expectations. The data indicates that the majority of outflows were in the U.S., with a net withdrawal of $721 million. Canada-based products also saw outflows of $28 million.
In contrast, European markets displayed a more positive sentiment. Germany and Switzerland recorded inflows of $16.3 million and $3.2 million, respectively.
Bitcoin and Ethereum Experience Major Outflows
Bitcoin (BTC) witnessed the largest outflows at $643 million. There were small inflows of $3.9 million for short-bitcoin. Ethereum (ETH) lost $98 million, mainly from the Grayscale Trust, as exchange-traded fund inflows slowed.
Solana (SOL) stood out with inflows of $6.2 million, the highest among digital assets. Bitcoin also experienced a significant drop in exchange activity. Daily inflows fell 68% from 68,470 BTC to 21,742 BTC, and outflows dropped 65% from 65,847 BTC to 22,802 BTC.
Data from Alternative shows that the Crypto Fear and Greed Index hit 26, its lowest point in over a month. This indicates increased investor anxiety and a more cautious market sentiment.
