Cryptocurrency investment products see $206 million in weekly outflows: CoinShares

Crypto investment products from asset managers such as Ark Invest, Bitwise, Fidelity, Grayscale, ProShares and 21Shares recorded their second straight week of outflows last week, totaling $206 million globally, according to a recent report from CoinShares.

“The data suggests that investor appetite for ETPs/ETFs continues to decline,” said James Butterfill, head of research at CoinShares. “This suggests that ETP/ETF investors’ preference is continuing to decline.”

Weekly cryptocurrency asset flows. Image: CoinShares.

Last week, global exchange-traded commodity trading volume also fell slightly, to $18 billion, accounting for 28% of total Bitcoin trading volume, compared to 55% a month ago, Butterfill added. At that time, daily Bitcoin exchange-traded fund trading volume reached a record high of nearly $10. 10 billion.

US spot Bitcoin ​ETFs led the weekly net outflows.

US spot Bitcoin ​ETFs contributed significantly to the global weekly figures, with net outflows of $204.3 million last week, following net outflows of $82.5 million the previous week.

BlackRock’s IBIT was the only spot Bitcoin ETF to maintain daily inflows last week, bringing in total inflows of $165.4 million, extending its inflow streak to 69 days before Friday’s Bitcoin halving.

“We woke up on April 20th and saw IBIT take cash for 69 consecutive days, which was also the halving. A little too perfect,” said Eric Balchunas, Bloomberg ETF analyst.

Adding in cryptocurrency futures products, the United States saw net outflows totaling $244 million last week, while Canada and Switzerland-based funds saw net outflows of $30 million and $8 million, respectively.

Global Bitcoin funds accounted for $192 million of total weekly net outflows. But with the $300,000 outflow from short Bitcoin products, “few investors saw this as an opportunity to short,” Butterfill said.

Meanwhile, Ether-based investment vehicles continued to see outflows for the sixth week in a row, with $34 million being taken out of funds. Litecoin and Chainlink products bucked the trend, generating inflows of $3.2 million and $1.7 million respectively.

Blockchain stocks also plunged, with outflows totaling $9 million for the 11th straight week due to concerns about the impact of the halving on the economy. bitcoin BTC

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What’s next for Bitcoin miners after the halving?

Bitcoin’s fourth halving occurred at 00:09 AM ET on April 20 (8:09 PM ET on April 19), reducing miners’ block subsidy rewards from 6.25 BTC to 3.125 BTC.

In a previous report released to coincide with Friday’s halving, CoinShares found that the average production cost per Bitcoin for listed mining companies was about $53,000 after the halving.

Bitcoin mining production costs are after halving. Image: CoinShares.

Analysts predict that Bitcoin’s total hash rate will rise to 700 EH/s by 2025, but suggest it could temporarily drop by up to 10% after the halving as less efficient operations begin to grind to a halt.

CoinShares also predicted hash prices to fall to $0.053 TH/s per day. Hash price is a term coined by Luxor that quantifies how much a miner can profit from a specific hash rate.

CoinShares analysts also expect diversification into AI given its potential to generate higher returns, noting that companies like BitDigital, Hive, and Hut 8 are already generating revenue from AI. “These trends suggest that Bitcoin mining may increasingly move to isolated energy sites, while investments in AI may increase in more stable locations.” they said

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