The cryptocurrency investment sector witnessed a significant downturn, with exchange-traded products (ETPs) experiencing record outflows of $6.4 billion. However, XRP emerged as a rare exception, attracting strong inflows and boosting its total assets under management (AuM) to new heights.
Crypto ETPs See Historic Outflows
According to the latest CoinShares report, crypto ETPs suffered their fifth consecutive week of capital flight, with $1.7 billion exiting the market last week alone. This brings the total outflows to an all-time high of $6.4 billion, reducing year-to-date inflows to just $912 million.
James Butterfill, Head of Research at CoinShares, highlighted that the market has endured 17 straight days of outflows—the longest streak since data tracking of global crypto ETPs began in 2015. The prolonged sell-off has caused total AuM to shrink by $48 billion, leaving the sector with just $133 billion under management.
US Investors Lead the Exodus
The United States played a dominant role in the recent sell-off, accounting for 93% of last week’s total outflows. Spot Bitcoin ETF providers—including BlackRock, Grayscale, Fidelity, and Ark 21Shares—saw significant withdrawals, with investors pulling out $401 million, $134 million, $317 million, and $68 million, respectively.
Bitcoin investment products recorded $978 million in outflows, bringing their five-week total to a staggering negative $5.4 billion. Short-Bitcoin positions also saw sell-offs, with investors withdrawing $3.6 million.
Other major cryptocurrencies were not spared. Ethereum investment products lost $175 million, while Solana saw $2.2 million in outflows. Blockchain equity funds also took a hit, with $40 million exiting the sector.
Meanwhile, Binance’s ETPs faced a near-total collapse in AuM after a key seed investor exited, leaving only $15 million under management.
XRP Bucks the Downtrend
Amid the broader market decline, XRP stood out by attracting $1.8 million in inflows last week. This brought its monthly total to $7.4 million, making it the second-best-performing asset behind Solana, which recorded $14.2 million in inflows.
For the year, XRP has accumulated $212 million in inflows, ranking third behind Bitcoin ($612 million) and Ethereum ($412 million). This surge in investment has propelled XRP’s total AuM to a record $1.2 billion.
Regulatory Optimism Fuels XRP Growth
XRP’s resilience can be attributed to growing optimism around regulatory developments. The long-running legal battle between Ripple and the US Securities and Exchange Commission (SEC) appears to be nearing a settlement.
Additionally, reports suggest the SEC may classify XRP as a commodity, which could increase the chances of an XRP-focused spot ETF gaining regulatory approval. If this materialises, it could further strengthen investor confidence in the digital asset.
