Crypto ETP inflows drop to $527M amid market turmoil

Cryptocurrency exchange-traded products (ETPs) experienced a significant decline in inflows last week, totaling just $527 million.

This marks a sharp 72% drop from the previous week’s inflows of $1.9 billion, according to CoinShares.

Market volatility was largely attributed to concerns surrounding the Chinese AI platform DeepSeek and heightened trade tensions due to U.S. tariffs initiated by President Donald Trump.

CoinShares research director James Butterfill noted that the news about DeepSeek led to approximately $530 million in outflows on January 27.

Despite these challenges, Bitcoin (CRYPTO:BTC) ETPs managed to attract $486 million in inflows, contributing to a year-to-date total of $4.9 billion.

Short-Bitcoin products also saw inflows for the second consecutive week, albeit at a reduced rate of $3.7 million.

In contrast, Ether (CRYPTO:ETH) and Litecoin-based (CRYPTO:LTC) ETPs failed to attract any new investments last week, with Ether ETPs recording a total of $177 million in inflows since the beginning of the year.

XRP stood out as a strong performer among altcoins, garnering $14.5 million in weekly inflows and achieving a year-to-date total of $105 million.

Grayscale Investments faced heightened selling pressure, with outflows increasing by 140% to reach $298 million last week.

This contributed to a cumulative outflow of $690 million for Grayscale’s crypto investment products this year.

Bitwise also reported substantial losses, with its ETFs experiencing $126 million in outflows, marking a 560% increase compared to the previous week.

Meanwhile, BlackRock's crypto ETFs saw a slowdown in inflows, dropping by 58% from the previous week’s figures.

The overall sentiment in the market remains cautious as investors react to economic uncertainties and regulatory developments.

“The inverse Cramer is always real when it comes to Bitcoin,” one market observer remarked, reflecting the ongoing volatility and investor sentiment.