While Congress has gone silent due to a partial government shutdown, the crypto market is feeling the impact.
The loss of funding over the weekend has not only put investors in a more cautious and risk-averse mood in the spot markets; it has also effectively frozen activity in the crypto ETF space.
As a result, money flowed out of crypto investment products on the last trading day before the weekend.
Bitcoin and Ethereum ETF see outflows
Discover Bitcoin [BTC] ETFs alone saw $509.7 million disappear in one day.
This contributed to the ongoing trend of steady outflows that has been going on since January 16, with only one day of inflows.
BlackRock’s Bitcoin ETF, IBIT, which typically attracts strong institutional demand, saw by far the largest outflows.
It included $528.3 million in net withdrawals, while most other Bitcoin [BTC] ETF issuers saw little to no activity.
This withdrawal of institutions happened when the price of Bitcoin fell by 5.1%, drop to around $78,734 in the last 24 hours according to CoinMarketCap.
For Ethereum, the situation was even worse.
ETH ETFs saw a combined $252.9 million in outflows according to data from Farside Investors.
BlackRock’s ETHA lost $157.2 million, while Fidelity’s FETH saw $95.7 million exit.
Meanwhile, Ethereum [ETH] price fell by more than 8%, traps to around $2,421 in the last 24 hours.
What about Solana and XRP ETF?
Solana [SOL] was also hit hard because of the price fell almost 10% to $105.36, in addition to $11.3 million in ETF outflow.
The majority of these sales came from Bitwise and Grayscale funds.
Ripple [XRP]however, moved against the trend.
Even though the price slipped Up 2.21% to $1.66, it was the only major crypto asset to see net inflows, attracting $16.79 million, according to SoSo value data.
This suggests that some investors are separating XRP’s long-term prospects from current political and market uncertainty.
What’s more?
While markets focused on falling prices and the government shutdown, Bitwise quietly took a major step toward launching a new product.
The company recently registered a Uniswap [UNI] ETF trusts in Delaware, which is usually the first legal step before formally filing with the SEC.
In short, even as short-term market pressures and political uncertainty weigh on prices, the race for an altcoin ETF application is not fading.
Final thoughts
- Institutional investors responded quickly and pulled large amounts of capital from Bitcoin, Ethereum and Solana ETFs.
- While prices fell loudly, the quiet moves of companies like Bitwise show that institutions are thinking beyond the current panic.