Digital asset investment products experienced a notable shift in investor sentiment recently, with the first significant outflows of 2025. According to a report by CoinShares, investors withdrew a total of $415 million from these products last week, marking a stark contrast to the consistent inflows seen since the US elections in November 2024.
The report highlighted that over the past 19 weeks, digital asset investment products had attracted a total of $24.9 billion, surpassing the $16 billion recorded in the first 19 weeks following the launch of spot Bitcoin exchange-traded funds (ETFs) in January 2024. James Butterfill, Head of Research at CoinShares, attributed the recent outflows to concerns over potential hawkish monetary policies in the US and higher-than-expected inflation data.
Bitcoin was the most affected by the sell-off, with investors pulling $430 million from BTC-related investment products. Butterfill pointed out that Bitcoin’s sensitivity to interest rate expectations played a significant role in the downturn. US-based Bitcoin ETFs experienced substantial outflows, with Fidelity leading the way with $282 million in withdrawals. Ark 21Shares and Grayscale also saw significant outflows of $163 million and $140 million, respectively.
In contrast, Ethereum remained more stable, with a smaller outflow of $7.2 million. Despite this, ETH continued to attract strong investor interest, garnering $785 million in net inflows for the month. While the US market reported $464 million in outflows, some European markets remained resilient, with Germany, Switzerland, and Canada seeing inflows of $21 million, $12.5 million, and $10.2 million, respectively.
Solana and XRP stood out as assets that attracted investor interest during this period. Solana saw a surge in investments, pulling in $8.9 million, likely due to growing anticipation around Solana-based ETFs. Multiple issuers, including Canary Capital, VanEck, 21Shares, and Bitwise, are seeking regulatory approval for these ETFs from the SEC. XRP also performed well, drawing $8.5 million in fresh capital and gaining momentum amid speculations of an XRP ETF.
Other blockchain assets also saw positive activity, with the Sui network recording $6 million in inflows and blockchain equities attracting $20.8 million. This brought the total inflows for the year to $220 million, indicating continued interest and investment in the digital asset space.
Overall, the recent outflows signal a shift in investor sentiment towards digital asset investment products, influenced by factors such as monetary policy expectations and inflation data. Despite the challenges faced by Bitcoin and Ethereum, other assets like Solana and XRP continue to attract investor interest, showcasing the dynamic nature of the digital asset market.