Investors pulled cash from crypto ETFs except for one altcoin this week, reshaping the ETF landscape in favor of smaller players.
The latest data shows investors withdrew cash from crypto ETFs with Bitcoin and Ethereum facing significant outflows. This movement occurred even as crypto markets continued trading around their current levels. Meanwhile, investors with exposure to Hyperliquid actually added to their positions, creating a divergence in institutional appetite.
CRYPTO PRICE CONTEXT
Bitcoin trading around $77,746 shows a modest 1.1% gain in 24 hours but remains down 3.9% over the past week. Ethereum at $2,288 gained 1.7% today but lost 2.6% this week. XRP stands at $1.27, up 1.9% daily but down 3.9% weekly.
THE MECHANSIM OF RUNE'S RECOVERY
RUNE rallied 15% as THORChain restarted most swaps after a weekend technical halt. The disruption began when a single Ethereum block reorganization removed a 10 ETH deposit that THORChain had already credited.
After the swap failed to meet its price limit, the protocol issued a refund against funds its vault had never actually received, resulting in an extra 10 ETH payout that triggered an automatic pause.
Node operators paused trading across multiple networks while developers investigated the bug. The network's status page now shows trading and transaction signing marked "OK" on 10 of its 13 listed external networks, including Bitcoin, Ethereum, Bitcoin Cash, Dogecoin, Litecoin, Tron and Zcash.
The partial restart restores access to several cross-chain swap routes, though BNB Smart Chain, Cosmos Hub and Solana continue to show warnings for both trading and transaction signing.
BROADER MARKET IMPACT
The THORChain halt also impacted attempts to move funds stolen in the $6.3 billion Binance hack, according to blockchain analytics company Chainalysis. The pause inadvertently delayed laundering efforts by North Korean hackers seeking to move stolen assets.
For now, crypto markets are taking direction from the stock market more than from Washington. Traders will watch whether Bitcoin holds key support levels as the political shift in Congress raises questions about the pace of new crypto legislation.