Grayscale Bitcoin ETF’s $2bn in outflows lead record bleed in crypto funds. Here’s what will lure investors back

Grayscale Bitcoin ETF’s $2bn in outflows lead record bleed in crypto funds. Here’s what will lure investors back
Falling crypto prices have spooked investors who were already put off by the high fees set by digital asset manager Grayscale. Credit: Shutterstock / Joyseulay
  • Digital asset investment products experienced $942 million in net outflows.
  • The record outflows were driven by investors exiting Grayscale’s Bitcoin ETF.
  • New Bitcoin ETF issuers saw net inflows despite the exodus.
  • Decentral Park sees them coming back: “sales effort to institutional clients have just started”

Investment funds that hold digital assets experienced record outflows last week as Grayscale’s Bitcoin exchange-traded fund bled nearly $2 billion.

Why?

Blame falling crypto prices, which have spooked investors who were already put off by the high fees set by digital asset manager Grayscale.

Record outflows

Digital asset investment products ended a seven week run of inflows with a bank, notching up a record $942 million in outflows last week.

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The seven-week run saw inflows of $12.3 billion.

Grayscale’s GBTC led the way with almost $2 billion in outflows.

Ethereum and Solana investment products also experienced outflows totaling about $34 million and $5.6 million, according to a CoinShares report on Monday.

The nine other US-based Bitcoin ETFs had over $1.1 billion in inflows, offsetting the fund exits fromGrayscale’s GBTC.

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The recent drop in crypto prices “led to hesitancy from investors, leading to much lower inflows into new ETF issuers in the US,” CoinShares head of research James Butterfill said.

Decentral Park’s Kelly Ye agreed. The first week of spot ETF outflow since January, is “likely due to the negative price action last week,” she said in a separate report.

“We are not particularly concerned about it as the sales effort to institutional clients have just started.”

“Poor sentiment was not just focussed on the US,” Butterfill added.

Sweden, Switzerland, Hong Kong and Germany saw outflows of $37 million, $25 million, $35 million and $4 million respectively, he said.

Brazil and Canada both experienced inflows of around $9 million, respectively.

Crypto market movers

  • Bitcoin added 2.7% to trade above $67,100 on Monday.
  • Ethereum rose 1.4% to $3,400.

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