Institutional Investors Reduce Bitcoin, Ether Exposure Amid Market Fluctuations: CoinShares
Summary:
The latest report from CoinShares reveals a slight withdrawal from Bitcoin investment products by institutional investors in the past week. The data shows a total withdrawal of $24.7 million and $13.6 million from Bitcoin and Ether respectively, among other trends. Despite these trends, the report indicates that investors see the recent price depreciation as an opportunity to increase their short-Bitcoin investments, with U.S. $13m inflows noted.
In the recent report from CoinShares, a renowned cryptocurrency investment company based in Europe, it was revealed that Bitcoin (BTC) investment products experienced slight withdrawals from institutional investors within the past week. The "Digital Asset Fund Flows Weekly" report by CoinShares, issued on January 22, indicates a shrinkage of Bitcoin engagements by institutional investors, recording a total withdrawal of $24.7 million over the last week.
The report ironically comes on the heels of intense sell-offs in the wake of a crypto market crash propelled by Bitcoin ETFs, where almost $21 million had been removed from crypto products between January 11 and May 19, before withdrawals slowed down slightly by the end of last week.
Trading volumes for ETF products have also witnessed a significant surge, amassing $11.8 billion within the last week alone. This accounted for 63% of all Bitcoin volumes on respected exchanges, clearly underlining the dominance of ETP activities across the overall trading sphere. A mild withdrawal of $21 million was observed in digital asset investment last week, with highly elevated Bitcoin trading volumes reaching $11.8 billion.
Understanding these issuer dynamics, CoinShares pointed out that despite last week's slight withdrawals from digital asset investment products, incumbent higher-cost spot issuers in the US saw a huge outflow benefitting their budding counterparts. James Butterfill, the Head of Research at CoinShares, noted "Incumbent, higher cost issuers bore the brunt in the U.S., suffering U.S. $2.9bn of outflows, whereas newly introduced ETFs have now amassed a total of US$4.13bn inflows since their inception.”
He further added that, “Investors perceived the recent depreciation in price as an opportunity to increase their short-Bitcoin investment products, evident by U.S. $13m inflows”.
Simultaneously, with the diminishing institutional demand for Bitcoin, there has been a noticeable decreased inclination for Ether within institutions — as Ether (ETH) experienced withdrawals amounting to $13.6 million over the last week.
This report by CoinShares underscores the significant influence of spot Bitcoin ETFs on the crypto market, signified by a 3.4% drop in the total market cap in the last 24 hours, now pegged at $1.59 trillion. This review is solely informational and not an endorsement for investments. Any trading or investment decision should be made after a thorough personal research as it bears inherent risks.
Published At
1/22/2024 8:32:00 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.