Digital asset investment products have seen outflows totaling $62 million over the last week, marking the seventh consecutive week of outflows, to a total of $329 million or about 1% of total assets under management. Notably, $XRP investment products stood out as inflows surged.
The sequence of outflows is now matching a similar trend seen at the beginning of 2022, according to CoinShares’ Digital Asset Fund Flows report, which notes that the change in total assets under management aligns with the outflow rate of 1%, implying that a drop in prices does not drive this trend, but instead by investors cashing in on their profits.
This assertion is further supported by the fact that prices have risen by 56% across investment products since the start of the year. These outflows come against a backdrop of subdued trading activity, with volumes standing at 60% below this year’s average, according to the report.
Leading cryptocurrency Bitcoin saw minor outflows over the last week totaling $2.7 million, while products shorting BTC saw outflows of $6.3 million. Over the past six weeks, total outflows for these short Bitcoin products have represented a staggering 44% of assets under management, compared to 0.9% for BTC-focused products.
This would suggest that investors are taking profits and closing out their short positions, rather than reflecting a larger shift in sentiment towards Bitcoin. When it comes to altcoins, smart contract platform TRON, which recently set a new record with nearly 11 million transactions in a day, stood out with volumes 60% below this year’s average.
Meanwhile XRP, the native token of the XRP Ledger, saw inflows of $600,000 over the past week, bringing its year-to-date figures to $4 million. Inflows are surging at a time in which the cryptocurrency has been adding billions to its market cap over a number of factors.
These factors include XRP seeing its second and third-largest address activity spikes of all time, in the span of just two days. The event could potentially signify upcoming substantial changes in the network’s market position.
The number of addresses interacting with the network recently ballooned to an unprecedented 490,000, according to on-chain analytics firm Santiment. The 490,000 figure isn’t far behind the largest ever recorded spike on March 18th, which triggered a remarkable 45% surge in XRP’s price over the following ten days.
The reasons behind the spikes in address activity on the XRP Ledger aren’t clear, although the cryptocurrency has seen its price rise earlier this month on reports that the SEC’s case against Ripple Labs, a major player in the cryptocurrency’s ecosystem, is now tilting in favor of the fintech firm.
Recently John Deaton, a well-known American lawyer and founder of CryptoLaw, revealed he believes the SEC has less than a 3% chance of an “outright total victory.”
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