Digital asset investment products witnessed a second straight week of capital flight, totaling $1.17 billion, according to the latest CoinShares report.
The broader crypto market remained tense following the October 10 liquidity cascade and growing uncertainty over a potential December interest rate cut in the United States.
Despite elevated trading activity with weekly exchange-traded product (ETP) volumes at $43 billion, optimism was short-lived.
Thursday saw a brief rebound on news of progress toward averting a U.S. government shutdown, but those gains evaporated by Friday as confidence faded again.
The data reveals a clear regional divide. The U.S. bore most of the negative sentiment, recording $1.22 billion in outflows.
In contrast, Europe displayed resilience, with Germany and Switzerland attracting inflows of $41.3 million and $49.7 million, respectively. This trend highlights a growing divergence in investor confidence between American and European crypto markets.
Also Read: Bitcoin Price Outlook: $125K Target Unlikely for 2025 Rally
Again, Bitcoin dominated market volatility with net outflows worth $932 million for Bitcoin investment products.Short Bitcoin ETPs recorded $11.8 million in inflows, the largest since May 2025 , signaling an increase in bearish positioning.
Similarly, Ethereum saw outflows worth $438 million. On the other hand, investment interest in altcoins is yet to dwindle.
Solana cryptocurrency saw significant inflows worth $118 million on a weekly chart and a whopping $2.1 billion in funds over a period of nine weeks. Smaller assets such as Hedera (HBAR) and Hyperliquid saw inflows of $26.8 million and $4.2 million, respectively.
According to CryptoQuant, short-term Bitcoin holders (STHs) are finding it increasingly challenging on the Binance platform.
The moving average of Bitcoin deposits made by STHs over a period of one week showed a sharp increase from 5,000 to 8,700 BTC, up by 40% in just one month. The realised price for this group rests at $112,000.
The above-mentioned pressure has caused emotional trading. There are STHs that have been reported to exit with losses, and others are waiting for a short-term rebound to sell.
The prominent platform for these activities is still Binance, which takes 48% of overall STH inflows because it is liquid.
Although these trends suggest weakness in the short term, looking through history, these types of shakeouts do occur commonly during mid-cycle corrections and can actually lead to a long-term recovery phase.
Also Read: Crypto Market Correlation With S&P 500 Breaks as Bitcoin Falls Under $100,000
