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This is How Institutional Investors Are Reacting To The Crypto Market Sell-Off

Written by: Elena R

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Elena R

Elena is an expert in technical analysis and risk management in cryptocurrency market. She has 10+year experience in writing - accordingly she is avid journalists with a passion towards researching new insights coming into crypto erena.

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Aug 23, 2022

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Since 2017 and 2018, Bitcoin and other cryptocurrencies in the market have experienced the longest-lasting adverse price trend. Since the significant rally of 2021, the overall crypto market has lost $2 trillion. However, despite sporadic increases, cryptocurrency values tend to swing more in the direction of the red lines these months.

Digital asset investment products saw small outflows of $9 million last week despite a significant market-wide selloff. Bitcoin (BTC) had a third consecutive week of withdrawals of $15 million, while Ethereum (ETH) reported inflows of $3 million last week, according to CoinShares’ Digital Asset Fund Flows. In light of the planned Merge on September 15, it appears that investors are more optimistic about Ethereum than Bitcoin.

According to the research, investments in digital assets lost a mere $9 million last week. Additionally, the volume of digital asset investment products reached $1 billion, which is still down 55% from the year average.

Due to pressure from the cryptocurrency market, the analysis implies that investor engagement is now low. The U.S., Germany, and Sweden were the countries with the most outflows reported. In contrast, Brazilian, Swiss, and Australian investors pour money into cryptocurrency investment products.

Why are There Withdrawals Happening?

The third week in a row that there have been withdrawals from Bitcoin investment products saw withdrawals of $15 million. Due to the FUD around the Fed’s rate hikes, there is some modest negativity surrounding Bitcoin. However, last week witnessed a little inflow of $0.2 million for short bitcoin. BTC’s price fell down below the 21,000 mark after the most recent bear market rebound failed to keep it above $25,000.

$3 million was invested into products related to Ethereum. This concludes a nine-week streak of $162 million in inflows. The improvement in communication on the Merge and its timing is the cause of the ongoing inflows. On September 15, the Ethereum core developers pushed for the Merge.

Small inflows were seen in the investment products for Cardano (ADA), XRP, and Binance Coin (BNB), among other altcoins. However, Solana (SOL) experienced outflows of $1.4 million for the second week. Institutional investors watch for a rally in the cryptocurrency market. Last week, there were $1.6 million in outflows from the cryptocurrency market for blockchain products.

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Elena R

Elena is an expert in technical analysis and risk management in cryptocurrency market. She has 10+year experience in writing - accordingly she is avid journalists with a passion towards researching new insights coming into crypto erena.

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