In today’s newsletter, CoinDesk Research’s Joshua de Vos breaks down May’s cryptocurrency outflows to explain what current market signals mean.
Then, in “Ask an Expert,” DAiM’s Bryan Courchesne addresses how investors can navigate the current market environment.
Crypto ETFs: May Breakdown and What’s Next
May ended two consecutive months of net inflows, and global crypto ETP flows once again turned into strong redemptions. According to data from TrackInsight, global digital asset investment products recorded $2.39 billion in net outflows, up from $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-listed vehicles accounted for almost all of the redemptions, while flows outside the US, which had already cooled in April, turned modestly negative.
The CoinDesk 20 Index (CD20), which captures a diversified representative sample of the top 20 digital assets, fell 1.11% in May after gaining 5.45% in April. The more concentrated CoinDesk 5 (CD5) index fell 3.73% and bitcoin itself fell 3.56%, a sharp decline from April, when bitcoin (up 11.87%) and CD5 (up 9.91%) led a broad rally. The performance hierarchy was also reversed: large caps led in April, while the broad index outperformed in May, indicating that large cap assets bore the brunt of the decline, while diversified exposure offered relative protection.
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, attracted net inflows, a divergence that widened throughout the month.
Higher ETF gains globally (based on May net flows)
- NEOS Bitcoin High Income ETF (BTCI): +$141.8 million; $1.24 billion in assets under management
- Bitwise Solana Stake ETF (BSOL): +$79.3 million; $672.2 million in assets under management
- Morgan Stanley Bitcoin Trust (MSBT): +$73.9 million; $260.1 million in assets under management
- Bitwise Hyperliquid ETF (BHYP): +$62.0 million; $71.1 million in assets under management
- iShares Staked Ethereum Trust ETF (ETHB): +$56.1 million; $584.3 million in assets under management
- 21Shares Hyperliquid ETF (THYP): +$49.7 million; $61.6 million in assets under management
- NEOS Powered Bitcoin High Income ETF (XBCI): +$42.8 million; $71.8 million in assets under management
- Franklin XRP ETF (XRPZ): +$38.7 million; $273.8 million in assets under management
- iShares Bitcoin ETP (IB1T): +$33.1 million; $1.06 billion in assets under management
US-listed products continued to dominate the global crypto ETF market in May. Despite net outflows of $2.37 billion, U.S.-domiciled ETFs closed the month with $119.2 billion in assets under management, retaining approximately 84.5% of the $141.1 billion global market, broadly in line with April’s 85.1%.
The May outflow ended two months of inflows and was overwhelmingly a turnaround in US large caps. The list of winners, on the other hand, was dominated by revenue, bets and newly launched products. With the CoinDesk 20 falling just 1.11% versus a 3.73% drop in the large-cap CD5, diversified and altcoin exposures showed relative resilience that flow data corroborated. That resilience has since been overwhelmed: By early June, Bitcoin had fallen to around $62,000, and major indices fell another 15% or more, leaving no sign that May’s capital outflows marked a bottom and pointing to intensifying pressure in June.
Read more: May global ETP roundup and US-focused May ETF roundup
– Joshua de Vos, Research Team Leader, CoinDesk
ask an expert
Q: Bitcoin’s RSI recently fell to 40. Why is that significant?
Bitcoin’s Relative Strength Index (RSI) has fallen below 40 on key time periods, which is a relatively rare occurrence. Similar readings were seen in February 2020 and during the March 2020 COVID crisis. In both cases, those oversold conditions preceded powerful rallies and substantial long-term gains. While no indicator guarantees future performance, historically these periods have often represented attractive accumulation opportunities for long-term investors.
Q: Does this signal present 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 is often more difficult when sentiment is negative, which is exactly why many investors miss out on these opportunities.
Q: What advice would you give to investors who are having difficulty evaluating crypto projects?
If you can’t confidently evaluate factors like 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 the noise?
A: Look for analysts and advisors with verifiable experience, a track record of getting it right more often than not, and a track record of providing evidence-based feedback. Be skeptical of anonymous influencers, paid promoters, and personalities whose primary business model appears to generate engagement. In many cases, the difference between a successful investment and costly mistakes comes down to ignoring the attention machine.
Q: What is the main takeaway from the current market environment?
This RSI setup could prove to be another important moment in bitcoin history. While no outcome is guaranteed, bitcoin has repeatedly rewarded patience, discipline, and long-term conviction. Fundamentals-focused investors may view current conditions as an opportunity, while those still waiting for unrealistic altcoin narratives to develop risk missing out on another bitcoin-led rally.
-Bryan Courchesne, founder, DAiM
Keep reading
- Japan’s three largest banks, MUFG, SMBC and Mizuho, plan to jointly issue a stablecoin by March 2027.
- The market capitalization of stablecoins reached a new all-time high of $320 billion, while the total market capitalization of real-world tokenized assets reached $28.9 billion – read the latest research.
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