Last week, investors took $2.9 billion out of cryptocurrency exchange-traded products, marking their biggest withdrawal ever. As per CoinShares, a European crypto investment firm report, on March 3, global crypto ETPs registered their biggest loss during three straight weeks, amounting to $3.8 billion.

The crypto exchange sector experienced unprecedented capital departure due to three substantial factors: the Bybit hack, the Federal Reserve’s position, and nineteen straight weeks of new investment into crypto ETPs.

According to James Butterfill from CoinShares, several investors began selling their holdings, while Cryptocurrency gained less charm. Investor trust decreased because security issues made investors uncertain, and new monetary policy decisions and regulatory problems piled up.

Bitcoin Leads ETP Outflows, Sui and XRP Gain

Bitcoin held the largest position among global crypto ETPs and lost $2.6 billion in investment funds during that week. Over two million people already withdrew their funds this month making BTC lose more market leadership. The Short Bitcoin ETP category of financial products collected $2.3 million but recorded limited investment activity.

During the recent week, 300 million dollars of Ethereum-based ETP products left their platforms as crypto markets took a turn. Although MTD inflows show $490.3 million in positive investment in Bitcoin, some investors remain confident in its future growth.

Last week, Sui gained more investment capital than other crypto ETPs, with $15.5 million in inflows, while Bitcoin and Ethereum let funding slip through. The XRP ETP market received $5 million in new investment from investors. Investors seek new ways to enter the digital asset market because they feel positive about the prospects of these assets.

Crypto ETPs Lose $138.8B Amid Market Uncertainty

Since the trading downturn, crypto ETP funds have lost $138.8 billion of their total managed assets. Because of major market changes, the cryptocurrency market value fell from $173 billion to $138.8 billion between January and October 2022.

Crypto ETP market analysts disagree about future performance because they have never seen this level of customer investment exit. The market sees recent decreases as part of a normal cycle when decentralization meets tight regulations and big economic factors.

Investors stay cautious while moving their money through this changing cryptocurrency investment market under new security and central bank regulation changes. The upcoming period will reveal if investors go back to buying digital currencies or move away from these assets.