Crypto Outflows Slow as Altcoins Attract Capital Amid Market Volatility

According to the latest Digital Asset Fund Flows Weekly Report from CoinShares, the $187 million withdrawn from crypto investment products last week marks a crucial inflection point. While outflows persist, their pace has slowed considerably. CoinShares analysts interpret this deceleration as a signal that the recent wave of panic selling may be abating, potentially indicating that the market is stabilizing and a local low in crypto prices could be forming. This sentiment shift comes as total assets under management (AuM) fell to $129.8 billion, the lowest level since March 2025, which itself coincided with a previous market low.

Contrasting the outflow figures, trading activity surged dramatically. Exchange-traded product (ETP) volumes skyrocketed to a record $63.1 billion for the week, decisively surpassing the previous peak of $56.4 billion set in October of the prior year. This surge in volume, occurring alongside slowing outflows, suggests heightened investor engagement and momentum, painting a more complex picture than the headline outflow number alone.

The data reveals a stark divergence between Bitcoin and the broader altcoin market. Bitcoin investment products bore the brunt of negative sentiment, experiencing $264 million in outflows. An additional $11.6 million exited short-Bitcoin positions, indicating a reduction in bearish bets but not enough to offset the overall selling pressure.

In sharp contrast, several major altcoins attracted fresh capital. XRP led the pack with a substantial $63.1 million inflow, further cementing its position as the year-to-date inflow leader with $109 million. Solana followed with $8.2 million, and Ethereum saw a more modest $5.3 million inflow. Other beneficiaries included Chainlink and Litecoin, with inflows of $1.5 million and $1 million, respectively. Multi-asset investment products also gained, raking in $9.3 million. This rotation of capital from Bitcoin into altcoins and diversified products highlights a tactical shift in investor preference during the market correction.

Geographically, fund flows presented a mixed global picture. Outflows were heavily concentrated, with the United States seeing $214 million exit and Sweden experiencing $135 million in withdrawals. Australia recorded a minor $1.2 million outflow. However, these were counterbalanced by meaningful inflows in other regions. Germany led with $87.1 million, followed by Switzerland ($30.1 million), Canada ($21.4 million), Brazil ($16.7 million), and Hong Kong ($6.8 million). This regional divergence underscores varying levels of institutional confidence and regulatory comfort across markets.

Despite Bitcoin’s price weakness, sliding to around $69,000, industry executives maintain a bullish long-term outlook. Bitget Chief Marketing Officer Ignacio Aguirre Franco projected that Bitcoin could reach the $150,000-$180,000 range this year if flows into spot Bitcoin ETFs stabilize and macroeconomic conditions improve. For Ethereum, Franco cited ongoing Layer 2 development and growing DeFi activity as foundations for a potential price target of $5,000-$6,000, contingent on increased participation from traditional finance.

Franco also emphasized the positive impact of regulatory progress, specifically mentioning developments like the recent Clarity Bill and advancing market-structure legislation. He argued that clearer compliance frameworks reduce uncertainty, making crypto assets more attractive to institutions and traditional funds. As institutional capital finds easier entry points and global regulatory alignment improves, the overall market’s stability and capacity for innovation are expected to strengthen, providing a firmer foundation for future growth beyond the current volatility.