The number of investors selling cryptocurrency Exchange-Traded Products (ETPs) last week reached a market record of $2.9 billion as reported by CoinShares in their March 3 update. The recent sell-off with bad performance continues for three weeks and causes investors to sweep out $3.8 billion from their investments.

CoinShares recognizes three main reasons for record-breaking crypto ETP outflows: the $1.5 billion Bybit security breach, rising Fed hawkishness, and 19 weeks of continuous buying that attracted $29 billion into crypto ETP investments. Head of research James Butterfill at CoinShares says a mix of investors took profits and shifted away from cryptocurrencies when these market events took place.

Bitcoin Faces Major Withdrawals

Bitcoin experienced substantial asset withdrawals of $2.6 billion from all crypto ETP products during that week. Bitcoin investors decreased their stake by $3.2 billion during the current month due to present market changes and uncertainty in the economy. Investors who predict a falling Bitcoin value put $2.3 million into short Bitcoin ETPs.

During the previous week Ether received $300 million fewer investments in Ethereum-based ETPs. The ETF still saw money come in through MTD at $490.3 million because investors see possible benefit over time.

Some altcoin-based exchange-traded products received positive investment while Bitcoin and Ethereum suffered from capital departures. During the recent period Sui attracted more than any other ETP product when investors invested $15.5 million into it. XRP ETP products received $5 million funds from investors. 

Market participant confidence decreases yet many investors take advantage of unique opportunities by putting their money into selected altcoins. The major asset withdrawals reduced total funds managed by crypto ETPs which stood at $138.8 billion last week. 

The total amount invested in crypto ETPs dropped from its $173 billion peak reached in January showing a major decrease. Market uncertainty forces investors to sell due to rising regulations plus security issues that combine with U.S. monetary policy changes. The current markets share different perspectives about crypto ETP performance over the next few weeks.