- DeepSeek launch triggers $534M crypto ETP exits; Bitcoin, Ethereum lead outflows as mining stocks decline.
- XRP ETPs attract $2.1M inflows; large wallets accumulate 120M tokens during market dip, bucking trend.
The introduction of AI platform DeepSeek aligned with $534 million in withdrawals from crypto exchange-traded products (ETPs) this week. Bitcoin ETPs saw $457.6 million in exits, while Ethereum products lost $136.2 million, per Farside Investors data.
These outflows offset $1.9 billion in inflows recorded earlier during Donald Trump’s second-term start, as we already reported on ETHNews. The global cryptocurrency market dipped 0.65% in 24 hours, according to ETHNews.
James Butterfill, Head of Research at CoinShares, connected the activity to DeepSeek’s release:
“Investors adjusted positions following the news.”
Bitcoin mining stocks Riot Platforms, Cleanspark, and MARA Holdings declined for two straight days, mirroring broader crypto trends. In contrast, XRP ETPs drew $2.1 million in inflows despite price swings. Blockchain data shows wallets holding 10 million+ XRP added 120 million tokens during the downturn.
“Yesterday’s rout in the markets caused by the DeepSeek news caused investors to panic, prompting outflows from Bitcoin and Ethereum totalling US$442m and US$99m respectively.”
Major U.S. tech stocks, including Nvidia and Apple, partially recovered recent losses, diverging from crypto markets. The Kobessi Letter noted this shift reflected capital reallocations, though DeepSeek’s exact market impact remains unconfirmed.
The platform’s AI-driven tools were linked to trading activity, but no automated sell mechanisms were verified.
XRP’s inflows occurred as its price stabilized after an initial drop, indicating some investors capitalized on lower valuations. Similar behavior occurred during prior market dips, where large holders increased positions. Bitcoin and Ethereum now face pressure to reclaim price levels above key support zones to stem further exits.
DeepSeek’s rollout revived discussions about AI’s role in crypto trading
Analysts suggest algorithmic systems might intensify sell-offs by executing pre-set orders or rebalancing portfolios. The event underscores crypto’s heightened reactivity to external factors compared to traditional assets.
Mining stocks remain vulnerable to Bitcoin’s price changes and energy market shifts, clouding short-term outlooks. XRP’s accumulation pattern provides limited bullish signals, as broader sentiment depends on Bitcoin’s performance. Regulatory filings show institutional XRP holdings unchanged, suggesting retail traders drove inflows.
The SEC has not commented on DeepSeek’s compliance with trading regulations
As AI tools become more embedded in markets, analysts call for oversight to mitigate volatility risks. For now, crypto participants watch for stabilization cues, with XRP’s divergence testing its capacity to decouple from Bitcoin’s movements.