Last week, crypto funds faced $1 billion in outflows amid market reactions to the Federal Reserve's stance. We delve into the details of these developments.
Market Reaction and Fund Outflows
According to CoinShares, digital asset investment products recorded $308 million in inflows last week, but the week ended with $1 billion in outflows over the last two days, including $576 million on Dec. 19 alone. This followed market reactions to hawkish Federal Reserve measures. Total assets under management fell by $17.7 billion, marking a 0.37% decline, reports CoinShares head of research James Butterfill.
Asset Dynamics in the Market
Bitcoin remained resilient, posting $375 million in net inflows for the week, while Ethereum saw $51 million in inflows, though this came at the expense of Solana, which recorded $8.7 million in outflows. Multi-asset investment products faced the steepest losses, with $121 million in outflows, yet interest in specific altcoins persists.
Bitcoin and Other Cryptocurrencies
The outflows occur as Bitcoin struggles to stay above the $100,000 mark, at times dipping below $95,000. According to CoinGlass, Bitcoin's descent triggered a $1.4 billion liquidation event, wiping out leveraged long positions within 24 hours.
The $1 billion in crypto fund outflows reflect the market's sensitivity to the Federal Reserve's stance. Nevertheless, Bitcoin shows resilience, and interest in specific altcoins remains.
