The negative sentiment in the cryptocurrency markets continues to grow, leaving institutional investors concerned. Recent data was worrisome, as buyers have not taken action despite the signals of excessive selling in Bitcoin prices. On the other hand, the latest data shows that the selling trend among institutional and qualified investors persists.
Crypto Investment Report for Institutional Investors
Crypto investment products saw a weekly outflow of $168 million, the largest amount since the crash in March. The bankruptcy process of banks in March caused excessive selling of cryptocurrencies. After reaching new highs, the price of Bitcoin dropped below $20,000 during this period.
Last week, the leading cryptocurrency, Bitcoin, experienced the most outflows. Institutional investors withdrew $149 million from BTC funds, expressing concerns about further declines. The total amount of outflows in August reached $278 million, while the weekly trading volume remained at $1.3 billion. This figure is significantly higher than the annual average. In other words, the lack of volume in cryptocurrencies was evident not only in CEX and DeFi platforms but also in ETP, Trust, and ETF products.
Escape from Crypto
The approval for a spot ETF for Bitcoin in the United States is weakening. The first response to many applications will be given by the SEC on Friday, and an extension is expected due to the unresolved Grayscale case. Outflows of $68 million and $61 million were seen in Germany and Canada, respectively, where most of the activities have taken place in recent months. Investors in these regions have also started to think similarly to qualified investors in the US.
Despite all the negativity, net inflows for 2023 are over $265 million and positive. However, if the outflows continue, the net positive could turn negative before the end of September.
The largest outflows among altcoins were in Ethereum (ETH) funds. ETH funds saw a total outflow of $17 million, while XRP and LTC funds saw inflows of around $500,000 each. We need to point out a small detail: since some of these outflows may come from funds that allow for opening short positions, they may not reflect a 100% fear of a decline.
