- Digital asset investment products saw record outflows of $2 billion last week, bringing a three-week total of $3.2 billion.
- Bitcoin and Ethereum led the sell-off, with 2% and 4% of total AuM exiting, respectively.
- Long-term Bitcoin holders are aggressively accumulating despite a bearish market, creating a sharp divergence between sentiment and strong hands’ behavior.
Digital asset investment products suffered significant outflows last week, with investors withdrawing a total of $2 billion, the largest weekly outflow since February 2025, according to CoinShares.
This marks the third consecutive week of outflows, bringing the cumulative total to $3.2 billion. The sharp decline reflects a combination of persistent monetary policy uncertainty and heavy selling from crypto-native whale investors.
Total assets under management (AuM) in digital asset ETPs have dropped from $264 billion at their early October peak to $191 billion, a decline of 27%.
The negative sentiment was concentrated in the United States, which accounted for 97% of outflows, totaling $1.97 billion.
Switzerland and Hong Kong followed with smaller outflows of $39.9 million and $12.3 million, respectively. German investors bucked the trend, adding $13.2 million to ETPs, viewing the weakness as a buying opportunity.
The worst-affected assets were Bitcoin and Ether. The Bitcoin ETP saw $1.38 billion withdrawn last week, which is 2% of its AuM, while Ether faced relatively higher outflows of $689 million, which is 4% of its AuM.
Other digital assets like Solana and XRP saw small outflows of $8.3 million and $15.5 million, respectively. Investors looking to diversify their assets withdrew $69 million into multi-asset ETPs, while short Bitcoin ETPs saw an inflow of $18.1 million.
Also Read: Bitcoin Enters Bear Territory With Price Falling Over 20% From ATH
Strong Hands Accumulate Bitcoin Amid Market Fear
CryptoQuant’s data shows a revealing market anomaly within Bitcoin markets. Despite market-wide selling, institutional holders continue to buy up impressive quantities of BTC at a historic rate.
Since October 6th, institutional holder balances, which correspond to addresses that don’t regularly buy and sell, increased their holdings from 159,000 BTC to 345,000 BTC.
Throughout history, such accumulations preceding rallies have generally occurred among price-insensitive traders, but this time around, the prices of Bitcoins have been falling.
This is an indication of a mismatch between panicking and accumulating. Analysts point to two likely outcomes: a strong rally once the supply is worked off and retail capitulation is complete, or a final decline that may cause long-term holders to rethink their strategy.
Crypto Market Outlook: Divergence Could Signal Sharp Moves
The present market environment is depicted as existing with both extreme market fear and aggressive accumulation by long-term capital. This has, on occasion in the past, resolved rapidly and markedly to result in strong market moves.
Investors willing to assess information rather than sentiment could discover opportunities during this unusual market period, although there is still a high degree of risk involved.
The market is at a critical point with billions worth of losses unrealized, but capital inflows to Bitcoin are considerable.
Also Read: Bitcoin Price Outlook: $125K Target Unlikely for 2025 Rally
