In today’s newsletter, Joshua de Vos, of CoinDesk Research, analyzes May’s crypto outflow to explain what current market signals mean.
Then, in “Ask an Expert,” Bryan Courchesne of DAiM addresses how investors can navigate the current market environment.
Crypto ETFs: Can Crashes and What’s Next
May ended two consecutive months of net inflows, with global crypto ETP flows swinging back to heavy redemptions. According to TrackInsight data, global digital asset investment products recorded $2.39 billion in net outflows versus $1.79 billion in net inflows in April as total assets under management fell to $141.1 billion from $158.7 billion a month earlier. US vehicles accounted for almost all of the redemption, while non-US flows, which had already cooled in April, turned modestly negative.
The CoinDesk 20 Index (CD20), which captures a diversified cross-section of the top 20 digital assets, fell 1.11% in May after rising 5.45% in April. The more concentrated CoinDesk 5 index (CD5) fell 3.73% and bitcoin itself fell 3.56%, a sharp reversal from April, when bitcoin (up 11.87%) and CD5 (up 9.91%) led a broad rally. The return hierarchy also reversed: large-caps led in April, while the broad index outperformed in May, indicating that large-caps bore the brunt of the decline, while diversified exposure provided relative shelter.
According to data from TrackInsight, outflows were concentrated in bitcoin- and ether-linked instruments globally, while parts of the altcoin market, led by XRP, Hyperliquid and Solana, drew net inflows, a divergence that widened during the month.
Biggest ETF Gainers, Globally (by May Net Flows)
- NEOS Bitcoin High Income ETF (BTCI): +$141.8 million; $1.24 billion AUM
- Bitwise Solana Staking ETF (BSOL): +$79.3 million; $672.2 million AUM
- Morgan Stanley Bitcoin Trust (MSBT): +$73.9 million; $260.1 million AUM
- Bitwise Hyperliquid ETF (BHYP): +$62.0 million; $71.1 million AUM
- iShares Staked Ethereum Trust ETF (ETHB): +$56.1 million; $584.3 million AUM
- 21Shares Hyperliquid ETF (THYP): +$49.7 million; $61.6 million AUM
- NEOS Boosted Bitcoin High Income ETF (XBCI): +$42.8 million; $71.8 million AUM
- Franklin XRP ETF (XRPZ): +$38.7 million; $273.8 million AUM
- iShares Bitcoin ETP (IB1T): +$33.1 million; $1.06 billion AUM
US-listed products continued to dominate the global crypto ETF market in May. Despite net outflows of $2.37 billion, US-domiciled ETFs closed the month with $119.2 billion in AUM, retaining about 84.5% of the $141.1 billion global market, broadly in line with April’s 85.1%.
May’s total outflows ended two months of inflows and was overwhelmingly a U.S. turnaround for large-caps. The list of winners, on the other hand, was dominated by income, stakes and newly launched products. With the CoinDesk 20 down just 1.11% versus a 3.73% drop in large-cap CD5, diversified and altcoin exposures showed relative resilience, as the flow data confirmed. That resilience has since been overwhelmed: by early June, Bitcoin had fallen to around $62,000 and the major indexes were down another 15% or more, leaving no sign that corn’s outflow marked a bottom and pointing to intensified pressure into June.
Read more: corn global ETP recap and corn US-focused ETF recap.
– Joshua de Vos, Head of Research Team, CoinDesk
Ask an expert
Q: Bitcoin’s RSI recently dipped into the low 40s. Why is it important?
Bitcoin’s Relative Strength Index (RSI) has dipped into the low 40s on key timeframes, a relatively rare occurrence. Similar readings were seen in February 2020 and during the COVID crash in March 2020. In both cases, these oversold conditions preceded strong recoveries and significant long-term gains. Although no indicator guarantees future performance, historically these periods have often represented attractive accumulation opportunities for long-term investors.
Question: Does this signal provide an opportunity today?
Potentially, yes. For investors who remain focused on bitcoin and have a long-term time horizon, periods of market pessimism have historically offered some of the best entry points. The challenge is that buying often feels most difficult when sentiment is negative, which is precisely why many investors miss out on these opportunities.
Q: What advice would you give to investors struggling to evaluate crypto projects?
If you cannot confidently assess factors such as real-world usage, security, tokenomics, decentralization, and adoption metrics, simplifying your approach may be the best option. Bitcoin remains the most established digital asset with the strongest network effects, the clearest store-of-value thesis, institutional support through ETFs, and a proven ability to survive multiple market cycles.
Q: How can investors separate credible advice from noise?
A: Look for analysts and advisors with verifiable experience, a track record of being right more often than not, and a history of evidence-based commentary. Be skeptical of anonymous influencers, paid promoters, and personalities whose primary business model appears to be generating engagement. In many cases, the difference between successful investing and costly mistakes comes down to ignoring the attention machine.
Question: What is the key to today’s market environment?
This RSI setup could prove to be another important moment in bitcoin history. Although no outcome is guaranteed, bitcoin has repeatedly rewarded patience, discipline and long-term conviction. Investors focused on fundamentals may see current conditions as an opportunity, while those still waiting for unrealistic altcoin narratives to play out risk missing out on another bitcoin-led rally.
– Bryan Courchesne, Founder, DAiM
Continue reading
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Looking for more? Receive the latest crypto news from Pakinomist.com and market updates from Pakinomist.com/institutions.
