Digital asset funds experienced another difficult week as investors withdrew $1.17 billion. This marked the second consecutive week of significant outflows. Investor confidence remains fragile following the liquidity shock on October 10th, and ongoing macroeconomic uncertainty surrounding the Federal Reserve's December policy decision continues to impact market positioning. Despite these outflows, CoinShares reported that trading volumes for Exchange Traded Products (ETPs) remained robust, reaching approximately $43 billion.
On Thursday, there was a brief improvement in fund flows as news emerged suggesting progress towards averting a US government shutdown. However, this short period of optimism quickly dissipated. By Friday, negative sentiment resurfaced, leading to renewed capital exits as concerns intensified and markets began to price in continued policy and fiscal uncertainty. Notably, altcoins have largely managed to buck this trend.
Altcoins Show Resilience Amidst Broader Outflows
According to the latest edition of the ‘Digital Asset Fund Flows Weekly Report,’ institutional capital moved sharply away from Bitcoin last week. Bitcoin-linked products recorded net outflows totaling $932 million. Conversely, short Bitcoin ETPs attracted renewed investor interest, drawing in $11.8 million, which represents their highest weekly inflow since May 2025. Ethereum also experienced outflows, with $438 million exiting its associated products.
In contrast, interest in several altcoins remained positive. Solana, once again, led the pack with substantial inflows amounting to $118 million, contributing to a remarkable accumulation of $2.1 billion over the past nine weeks. XRP followed, securing $28.2 million in fresh inflows, closely trailed by Hedera with $26.8 million. Hyperliquid saw inflows of $4.2 million, and Litecoin managed to attract $1.9 million. Multi-asset funds also garnered over $12 million in investments. On the other hand, Sui and Cardano experienced outflows of $3.8 million and $0.1 million, respectively.
The data also indicates a pronounced regional imbalance in fund flows. The United States remains the most affected region, with outflows totaling $1.22 billion. Hong Kong followed with $24.5 million in outflows, and Sweden recorded an outflow of $18 million during the same period. Smaller outflows were also reported from Canada and Australia, amounting to $7.6 million and $1.1 million, respectively.
Conversely, investor appetite increased in certain parts of Europe and Latin America. Germany posted inflows of $41.3 million, Switzerland attracted $49.7 million, and Brazil registered fresh inflows of $12 million for the week.
Market Recovery Faces Significant Headwinds
Progress in the Senate regarding a funding deal boosted risk sentiment, pushing Bitcoin back above $106,000 after multiple attempts to break below the $100,000 mark failed. QCP Capital observed that this rebound is occurring despite ongoing outflows from spot Bitcoin ETFs and continued selling pressure from long-term holders. Options market activity remains divided, with some buyers positioning for upside potential into December 2025, while others are selling call options at higher strike prices.
The firm noted that distributions from older wallets bear similarities to past events such as those related to Silk Road and Mt. Gox, suggesting that historical market behavior indicates the potential for markets to absorb such supply. QCP anticipates that Bitcoin will likely remain within a trading range for the immediate future, and any significant move above $118,000 is expected to trigger further selling from long-term holders.