US investors drove the majority of crypto outflows.
After five straight weeks of inflows, digital asset investment products turned negative during the previous one, with $414 million in outflows. Investors are becoming more cautious due to the Iran conflict and growing concerns around inflation, according to CoinShares. Expectations for the June FOMC meeting have also shifted significantly. Markets had earlier priced in rate cuts, but are now leaning toward possible rate hikes.
Such a change in sentiment has pushed total assets under management (AuM) down to $129 billion, bringing it back to levels seen in early February and around April 2025 during Trump’s tariff rollout.
According to the latest edition of CoinShares, negative sentiment hit Ethereum the hardest, possibly due to the latest Clarity Act news, as $222 million exited the asset. This pushed its yearly total to a net loss of $273 million, the poorest performance across digital assets. Bitcoin also experienced $194 million in outflows during the week, but it continues to maintain a net positive position of $964 million so far this year. Meanwhile, short-Bitcoin products drew an additional $4 million.
Solana recorded $12.3 million in withdrawals, while Sui posted a smaller decline of $0.4 million. Multi-asset products also witnessed an outflow of $4.4 million. On the other hand, XRP attracted $15.8 million as it stood out among peers. Chainlink and Stellar each recorded modest gains of $0.2 million during the same period.
Investor activity showed a clear regional divide, with the United States leading the declines as $445 million was removed from digital asset products. Switzerland, Sweden, and Hong Kong also saw smaller reductions of $4 million, $3.5 million, and $0.6 million. Meanwhile, Germany and Canada took advantage of lower prices and welcomed $21.2 million and $15.9 million, respectively. Brazil also bucked the negative trend and recorded a smaller gain, with investors allocating an additional $2.6 million.
Weak Market Conviction
The change in flows is consistent with Bitcoin’s recent lack of momentum. According to QCP Capital, the leading crypto asset is likely to stay range-bound in the near term, and price action is expected to continue between $65,000 and $70,000. Bitcoin has been showing a repeated pattern where it dips toward the weekend as traders reduce positions, then recovers at the start of the week. While it has managed to hold this range and even outperform gold and major equities since the Iran conflict began, overall sentiment remains fragile.
It is now on track for a sixth straight monthly decline and its first three-month losing streak of the year. As such, QCP observed that a stronger conviction will be needed for any meaningful upside, especially after recent selling pressure following quarterly options expiry. The firm expects Bitcoin to remain largely sideways at least until early April, when a crucial US deadline on potential military action against Iran approaches.
You may also like:
Rising geopolitical risks and high oil prices could keep inflation high, which may influence BTC’s longer-term appeal as a non-sovereign store of value.
