- The crypto market has struggled since the launch of spot ether ETFs, the report said.
- Citi noted that spot bitcoin and ether ETFs have seen net outflows in the past month.
- Stablecoins have been the outlier, with market caps continuing to grow, the bank said.
The analysts, headed by David Glass, noted that these outflows occurred at a time when there was comparatively lower curiosity in searches and reduced activity on networks.
The reduced demand is similarly noticeable in the futures funding rates, as these rates momentarily dipped below zero in August, according to the bank’s statement.
Citi predicts that the flow of funds into ETFs could remain low until there is greater clarity about whether the U.S. economy will experience a ‘soft’ or ‘hard’ landing.
Despite the market correction in August, the growth in stablecoin supply has defied the recent downward trend in the digital asset sector, as indicated by the report.
A stablecoin represents a form of digital currency that is typically linked to the value of the U.S. dollar; however, it can also be tied to other currencies or assets like gold for stability purposes.
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2024-08-27 12:10