Outflow from Crypto Funds Continues for Sixth week in a Row: CoinShares

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CoinShares analysts reported that from March 11 to 17, $95 million were withdrawn from cryptocurrency investment products, following a record of $255 million the week prior.

This has resulted in cumulative withdrawals totaling $406 million, or 1.2% of the funds under management, over the past five weeks.

Positive market conditions allowed AUM to reach its highest level since the collapse of the cryptocurrency hedge fund Three Arrows Capital in June 2022; a 26% increase in one week brought the AUM to $33 billion.

Daily trading volume doubled to $2.6 billion. The majority of the outflows were concentrated in bitcoin products, with a total of $113 million withdrawn (compared to $244 million the week before). Funds used to open positions for shorting bitcoin instead brought in $34.7 million (as opposed to an outflow of $1.2 million from the previous period).

According to the analysts, this indicates that the outflow of funds was due to liquidity needs, rather than negative sentiment.