Crypto Funds Bleed Again: 5 Weeks of Outflows Show Deepening Investor Fatigue

Investor appetite for digital asset funds remains muted after $288 million in weekly outflows. This is the fifth week in a row of redemptions, which propelled aggregate withdrawals to $4 billion, still trailing the $6 billion logged last year.

Market participation has thinned significantly, as ETP trading slid to $17 billion, the weakest level since July 2025, amidst signs of disengagement among institutions and retail allocators alike globally this quarter.

Short Bets Quietly Surge

According to the latest edition of CoinShares’ Digital Asset Fund Flows Weekly Report, Bitcoin remains the primary drag on market sentiment, shedding $215 million. In addition, bearish positioning intensified as short-bitcoin funds absorbed $5.5 million, which is the highest inflow among individual assets. Ethereum also experienced notable withdrawals of $36.5 million, joined by continued selling in multi-asset products and Tron, which lost $32.5 million and $18.9 million, respectively.

While XRP, Solana, and Chainlink attracted limited inflows ranging between $1.2 million and $3.5 million, these gains did little to offset persistent net outflows across altcoins.

The US dominated weekly flows on the downside as it contributed $347 million in outflows, while investors outside the country treated recent price declines as an entry point. Inflows were led by Switzerland, Canada, and Germany at $19.5 million, $16.8 million, and $16.2 million, respectively. Smaller allocations of of $3 million, $2.7 million, and $1 million also flowed into Brazil, Australia, and the Netherlands, respectively.

Bitcoin Stuck in a Macro Storm

Bitcoin slipped below $65,000 during Monday’s early Asia trading, which ended up triggering roughly $230 million in long liquidations as markets grapple with a convergence of geopolitical and macro risks. The move followed Donald Trump’s decision to raise a proposed global tariff to 15%, announced shortly after the Supreme Court of the United States struck down his “Liberation Day” tariffs.

This was enough to compound policy uncertainty amid already thinning risk appetite and renewed concerns around a potential US-Iran conflict. QCP Capital stated that the focus is not on whether Bitcoin has failed, but how long this storm persists.

With BTC on pace for a fifth red monthly close, historically a late-stage signal, all eyes are now on upcoming catalysts, including progress on the Clarity Act and US-Iran talks. But QCP added that a reclaim of $74,000 remains critical for a durable recovery.

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