Trading Activity Spikes as Digital Asset Investment Products Experience Outflows
Trading activity in digital asset investment products surged during the week ending September 1, according to the latest report from CoinShares. However, the increase in volume had little impact on the cryptocurrency landscape as prices continued to trade sideways. The various funds tracked by CoinShares witnessed minor outflows of $11.2 million last week, extending the streak of negative sentiment in the market. Over the past seven weeks, a total of $342 million has flowed out of digital asset investment products, with the majority being withdrawn from Bitcoin-related products.
Although there were minimal inflows for Bitcoin last week, breaking a three-week streak of outflows, altcoins faced significant outflows. Polygon (MATIC) accounted for $8.1 million in outflows, followed by $3.2 million worth of outflows from Ethereum products. Despite this, Solana had its ninth consecutive week of outflows, with $0.7 million exiting these products. However, the year-to-date inflows for Solana stand at $26 million, indicating its popularity among investors.
Investment products in Germany experienced the bulk of redemptions, with $26.9 million pulled from these funds. On the other hand, Switzerland saw inflows worth $14.8 million, helping offset the outflows. Blockchain equities also faced outflows for the fourth consecutive week, totaling $25 million, according to the report.
While trading volumes were higher than average, totaling $2.8 billion for the week, the Grayscale ruling had a limited impact on BTC’s volumes. BTC briefly hit $28,000 following a court ruling in favor of Grayscale in its dispute with the SEC. However, these gains were soon erased after the SEC announced a delay in its decision on seven ETF applications. The buying frenzy after the court ruling had a positive impact on the cumulative volume delta on major pairs, with Binance showing a significant increase in volume. However, selling escalated after the SEC’s decision, leading to a sharp decline in BTC instruments on Binance. Overall, trade volume and derivatives activity have remained relatively muted in recent months.