Digital asset inflows recover, but ETF activity slows

Spot Bitcoin ​ETF Demand Cools After March Peak

After a period of net outflows, the cryptocurrency market has seen a positive shift with net inflows of $862 million last week compared to net outflows of $931 million the previous week. However, enthusiasm for spot Bitcoin exchange-traded funds (ETFs) appears to be waning, with daily trading volume falling 36% to $5.4 billion compared to a peak of $9.5 billion in early March.

Bitcoin dominates digital asset flows

Bitcoin led digital asset inflows with $863 million, mainly driven by ETF demand. The spot BTC ETF recorded inflows of $1.8 billion, a stark contrast to Grayscale Bitcoin Trust (GBTC)’s outflows of $965 million. Despite the approval of a spot BTC ETF in the US on January 11, GBTC continues to experience significant outflows, putting selling pressure on the BTC price over the past three weeks.

GBTC outflow and BTC price impact

Continued outflows from GBTC, which continues to dominate ETF flows, have raised concerns about selling pressure on the BTC price. Bitcoin has experienced a drop of $4,000 in the last 24 hours and is trading just above $66,000 at the time of this writing. This price correction, which led to the liquidation of nearly $500 million, came ahead of the Bitcoin halving event scheduled for April 20. The options market also showed signs of bearish sentiment due to excessive put calls.

Ethereum and altcoin market trends

Ether recorded a loss of $19 million last week, marking its fourth straight week of outflows. Nonetheless, the altcoin market as a whole saw net inflows of $18.3 million, with Solana’s token leading the way with $6.1 million in inflows. The regional distribution of inflows and outflows shows that the United States experienced the largest outflow at $897 million, while Europe and Canada combined experienced outflows of $49 million.