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Cryptocurrencies see outflows for 5th straight week led by Bitcoin: Report

The crypto market cap had again slipped below the $2-trillion mark on Tuesday after crossing the $3 trillion market cap in November last year.

Bitcoin led the outflow tally with $55 million outflows during the week. (Image: pexels)

Institutional investors continued to pull money out of cryptocurrency products and funds for the fifth straight week amid an ongoing decline in Bitcoin and other crypto prices. Digital asset investment products recorded outflows amounting to $73 million last week – the fifth straight week of outflows. The total outflows in the past five weeks stood at $532 million, digital asset management firm CoinShares said in its weekly summary of digital asset fund flows. “This marks the sharpest outflows since 2018 when viewed proportionally as a percentage of total assets under management (AuM),” said CoinShares’ investment strategist James Butterfill,

Bitcoin led the outflow tally with $55 million outflows during the week, with four out of the last five weeks seeing outflows totalling $317 million. Moreover, the total Bitcoin AuM reached a three-month low of $35 billion mid-week. Other assets including Ethereum saw outflows amounting to $30 million, entering its sixth week of outflows totalling $230 million. “From a relative perspective Ethereum remains the focus of negative sentiment with outflows representing 1.5 per cent of AuM,” the report added. Ethereum’s AUM was $14.4 billion. Also, Binance outflows stood at $1.5 million.

Also read: Bitcoin may slide below $30,000 this year as the crypto bubble begins to burst: Invesco

In contrast, Solana remained an investor favourite with inflows totalling $5.4 million last week. Solana has only seen two individual weeks of outflows since August 2021. Ripple also saw inflows amounting to $1.3 million.

Despite continuous outflows for five weeks, the negative sentiment could be cooling off, Butterfill wrote. “On a daily basis, for the first time this year, we saw inflows on Wednesday and Friday, suggesting the bearish sentiment is beginning to abate after recent positive price moves.” 

Importantly, on an annual basis, cryptocurrency products and funds saw a 36 per cent jump in inflows during 2021 from the preceding year. The inflows had jumped from $6.8 billion in 2020 to $9.3 billion in 2021 even as the growth from 2019 to 2020 was significantly higher at 806 per cent, CoinShares had said earlier this month. Nonetheless, the crypto market cap had again slipped below the $2 trillion mark on Tuesday after crossing the $3 trillion market cap in November last year. It had dipped below the $2 trillion mark in September 2021.

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