Ether investment products experienced a negative flow of $38 million, marking their ninth consecutive week of decline, while concerns over U.S. stagflation, characterized by a slowing economic growth rate and persistent inflation, are causing anxiety among investors.
CoinShares’ report reveals that crypto investment products saw an outflow of $435 million for the week ending April 26. As the price of Bitcoin remains stagnant around the $60,000 mark, crypto exchange-traded products (ETPs) have witnessed withdrawals for three consecutive weeks.
Bitcoin funds were the most active in terms of outflows, with $423 million leaving the market following the halving event. Additionally, Ether investment products saw $38 million flowing out, continuing their negative trend for the ninth week. On a positive note, the Solana ETP experienced a net influx of $4.1 million, while the Litecoin ETP saw a net inflow of $3.1 million.
CoinShares attributes the negative outflows to a deceleration in inflows from new issuers, as there were $126 million in inflows last week compared to $254 million the previous week.
Farside Investors data reveals that IBIT, BlackRock’s Bitcoin exchange-traded fund, experienced “zero flows” for the first time last week. Withdrawals from Grayscale’s GBTC have also slowed down, resulting in some issuers witnessing days with no inflows in recent weeks.
Investors’ concerns about U.S. stagflation, which entails a slowdown in economic growth coupled with persistent inflation, are likely contributing to the negative outflows. This, in turn, reduces the likelihood of the Federal Reserve cutting interest rates.
As of now, traders estimate the chances of a rate decrease in June to be only 11.3%, according to the CME FedWatch tool. In comparison, the odds for rate decreases in September and November stand at 44.8% and 43.8%, respectively.
Market observers are anticipating that the U.S. Federal Reserve will maintain interest rates at their current levels in May and June, with a potential rate decrease anticipated later in the year.
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