The cryptocurrency market experienced a notable shift in investment patterns as digital asset investment products recorded outflows totaling $16 million last week. This marked the end of an 11-week streak of consecutive inflows, as reported in the latest Coinshares Digital Asset Fund Flows Weekly Report.
Crypto Landscape’s Strength
Despite the outflows, trading activity remained robust and well above the year average, amounting to an impressive $3.6 billion for the week, compared to the year-to-date average of $1.6 billion. Analysts suggest that this divergence may indicate profit-taking rather than a fundamental shift in sentiment toward the crypto asset class.
The regional breakdown of outflows revealed a focus on the United States, which saw $18 million leaving the market. Germany also experienced minor outflows totaling $10 million. However, these losses were partially offset by continued inflows into Canada and Switzerland, amounting to $6.9 million and $9.1 million, respectively. The mixed regional flows further support the theory that the recent outflows were more likely a result of profit-taking strategies.
Bitcoin, the leading cryptocurrency, bore the brunt of the outflows, losing $33 million in the past week. Short-bitcoin also experienced minor outflows totaling $0.3 million. In contrast, altcoins bucked the trend, attracting $21 million in inflows.
The primary beneficiaries of this trend were Solana, Cardano, XRP, and Chainlink, receiving $10.6 million, $3 million, $2.7 million, and $2 million, respectively. Ethereum and Avalanche faced some headwinds, with outflows of $4.4 million and $1 million, respectively.
On the other hand, Blockchain equities continued to ride the wave of positive sentiment, witnessing substantial inflows totaling an impressive $122 million last week. I brought the cumulative inflows over the past nine weeks to $294 million, marking the largest run on record.
Meanwhile, a recent report from KuCoin Research highlighted a rising influx of capital into the cryptocurrency market. KuCoin’s findings emphasized the resilience of the crypto landscape, noting a notable upswing in investments in November. During this period, there was a recovery in the size of investment deals, particularly in seed rounds, dominating the funding range of $1 million to $10 million.
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