Crypto Funds See $1.67B Weekly Outflows, Bitcoin Hit Hard

Crypto investment funds recorded staggering outflows of $1.67 billion last week, marking their third consecutive week of losses, according to CoinShares. The exodus was driven by institutional selling in the U.S. and a massive $1.44 billion withdrawal from Bitcoin (BTC) exchange-traded products (ETPs)—the largest weekly Bitcoin outflow of 2026.

The three-week sell-off has now totaled $4.21 billion, with assets under management (AUM) for crypto ETPs dropping to $141 billion, their lowest point since early April. Bitcoin funds bore the brunt, with their AUM falling to $114.6 billion. Despite year-to-date inflows of $1.2 billion, Bitcoin products are $2.4 billion down for May alone, highlighting the sharp reversal in market sentiment.

Institutional De-Risking Drives Market Weakness

The U.S. accounted for $1.63 billion of last week’s global outflows, aligning with the $1.42 billion withdrawn from U.S.-listed spot Bitcoin ETFs, according to SoSoValue data. This follows a broader trend of institutional de-risking in May, exacerbated by geopolitical uncertainty, including Iran-related tensions, and macroeconomic headwinds.

Notably, on May 28, BlackRock’s iShares Bitcoin Trust (IBIT) shed $527.84 million in a single day, adding to a two-week streak where U.S. spot Bitcoin ETFs collectively lost over $2 billion. May has been a stark contrast to the bullish momentum seen in April, where inflows dominated. Swissblock data shows that U.S. spot ETFs have accumulated only 4,500 BTC year-to-date, with May marking a clear shift from accumulation to distribution.

Altcoins and Ethereum Also Struggle

Ethereum (ETH) funds continued to face selling pressure, recording $257.3 million in outflows last week. Year-to-date, ETH products have now seen net outflows of $346 million, further underscoring the flight from riskier crypto assets.

Altcoins fared even worse, with participation collapsing. Only five assets managed inflows above $1 million last week, down from nine the week prior. XRP (XRP) led inflows with $20.3 million, followed by Hyperliquid (HYPE) and Near Protocol (NEAR) at $10.8 million and $7.6 million, respectively.

Market Impact: Bitcoin Remains Under Pressure

As of June 1, Bitcoin is trading at $72,583, down 1.7% over the past 24 hours, with a market capitalization of $1.43 trillion. Despite a lack of a clear catalyst for last week’s sell-off, Laser Digital’s derivatives desk pointed to weak equity markets and subdued retail demand as contributing factors. This sentiment was echoed by Strategy, which confirmed it did not purchase any BTC between May 18 and May 24, signaling caution among even the most bullish institutional players.

Looking ahead, the flow dynamics of institutional products like Bitcoin ETFs will likely remain a key driver of market sentiment. Until demand recovers or macro risks subside, the crypto market appears set for continued volatility.

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