DeepSeek triggers $530M outflow before market rebound

The cryptocurrency market experienced significant fluctuations last week, primarily influenced by the news surrounding DeepSeek, a new AI model from China.

On Monday, investor sentiment shifted dramatically, resulting in $530 million in outflows from digital asset products.

This sell-off was fueled by concerns over potential disruptions in the market, particularly regarding US trade tariffs.

Despite the initial downturn, the market rebounded with over $1 billion in inflows later in the week.

Overall, digital asset products saw total inflows of $527 million during the week, indicating a resilient recovery.

CoinShares reported that Bitcoin (CRYPTO:BTC) attracted $486 million in inflows, while short-Bitcoin investments continued to grow, totaling $3.7 million for the second consecutive week.

Ethereum (CRYPTO:ETH) faced challenges but ended the week with net-zero flows, reflecting its vulnerability to broader economic concerns.

XRP (CRYPTO:XRP) emerged as a standout performer with year-to-date inflows of $105 million, including $15 million last week.

In terms of regional performance, the US led with $474 million in investments, contributing to a total year-to-date inflow of $5 billion.

Conversely, Canada saw significant outflows of $43 million, likely driven by fears of US-imposed tariffs affecting the market.

Europe also showed positive trends with digital asset products attracting $78 million last week.

Switzerland and Germany were notable contributors to this growth, while Sweden faced outflows of $3.6 million.