According to CoinShares’ report, cryptocurrency investment products experienced an outflow of $726 million last week. This was recorded as one of the largest outflows observed in the crypto market.

CoinShares head of research James Butterfill noted in his weekly digital asset fund flows report published on September 9 that crypto investment products matched the largest outflow recorded in March 2024.

In March 2024, crypto products experienced a total outflow of $942 million. Last week, a total outflow of $643 million was seen in Bitcoin-based crypto investment products. There was an outflow of $98 million in Ethereum. On the other hand, Solana recorded the highest inflows among other assets, raising a total of $6.2 million.

This selling pressure is associated with stronger than expected macroeconomic data from the US in the previous week. These data strengthened the possibility of a 25 basis point interest rate cut by the Fed. Daily outflows slowed as weak US labor data came in, raising expectations for a possible 50 basis point rate cut by the Fed.

“Markets are awaiting Tuesday’s Consumer Price Index inflation report. If inflation remains below expectations, a 50 basis point cut could become more likely,” Butterfill noted.

This is considered a particularly positive development for risky assets. 21Shares analyst Leena ElDeeb said the latest US labor market results represent a “moment of truth” for risky assets like Bitcoin.

“An interest rate cut has historically supported an expansion of investor appetite when borrowing costs fall. Additionally, other factors can be pointed to for Bitcoin’s potential boom. One of these factors is global central bank liquidity,” ElDeeb said.

ElDeeb noted that Bitcoin recently bottomed out, where M2 reached historically low levels, and then experienced a rapid price increase, outpacing liquidity growth. This may indicate that Bitcoin is entering a possible recovery period.

Apart from the massive sales in crypto products, a similar selling trend is also observed in the crypto exchange market. According to a report by CNBC, Coinbase (COIN) shares had their worst week of 2024 and fell to their lowest value since February.

According to TradingView data, COIN closed at $147 on September 6 and has lost nearly 14% of its value since the beginning of the year. Additionally, some major Bitcoin mining companies also experienced double-digit declines during the week; CleanSpark’s 24% decline was the most notable.

These developments provide important clues about how uncertainties in the cryptocurrency market and a possible interest rate cut may affect investor behavior. How the crypto market will react to such developments remains an issue that investors follow carefully.