- Digital asset investment products saw $240 million in outflows, with Bitcoin accounting for most of it.
- On-chain data shows Bitcoin remains in a bear market, as rising capital inflows are not driving prices higher.
Digital asset investment products experienced a negative flow of $240 million last week, and Bitcoin contributed $207 million. The retreat came amid renewed market tension triggered by U.S. trade tariffs that stirred fears of economic slowdown.
However, total assets were up by 0.8% to $132.6 billion, which analysts consider resilient compared to overall market volatility. As a result, MSCI World equities fell by 8.5% during the same time frame.
The switch in sentiment was not limited to that. The largest net outflows were identified among US investors, who withdrew $210 million, and German investors withdrew $17.7 million. However, Canada was an exception, and it had an inflow of $4.8 million due to locals taking advantage of weak markets.
Altcoins experienced mixed flows. Ethereum coins recorded the largest outflows of $ 37.7 million, followed by Solana and Sui at $1.8m and $4.7m losses, respectively. Among all the tokens, only Toncoin demonstrated net inflows amounting to $1.1 million. Blockchain equities saw $8m for the second week in a row, indicating some investors are preparing for a rebound in the sector.
Bear Market Could Linger for Months
Ki Young Ju of CryptoQuant stated that the Bitcoin price is stagnant despite increased capital inflow, which has created a bear market structure. On-chain data show that while realized capitalization, money flowing into Bitcoin through trades, is increasing, the exchange-based cap is stagnant or even falling.
Ju noted that such independence often indicates a bear market, in which even a sizable rally cannot generate the market’s positive momentum. He also stated that in past situations, it has always taken at least six months to see a reversal of trends. This means that while interest in Bitcoin continues to rise, its price is set to remain stagnant in the short term.
Bitcoin has seen a bearish start to the month of April, sliding by as much as 7.69% to $77,077, its weakest point in three weeks. As per Coinglass, Bitcoin recorded a net decline of 11.8% at the beginning of Q1, marking its fall as the worst since 2018. Previous Q1 declines have had varying effects; more bear market cycles occurred in the past in 2014, 2018, and 2022, as well as the Q1 decline.
Tariffs, Recession Fears, and Soaring Liquidations
The return of U.S. tariffs under President Trump’s economic policy has rattled global markets, and digital assets are no exception. The tariffs have been labeled as the cause of the recession, further contributing to the destruction of the perception that Bitcoin is an instrument against traditional financial risks.
Crypto liquidations have risen to $1.4 billion within the past 24 hours only. Bitcoin was the biggest driver of the volume, with an 8% decline and touching as low as $76,100. The sudden shift reflects the volatility in sentiment in the current circumstances. Despite robust performance in AUM, price trends have been quite lackluster for the digital asset market.
