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Bitcoin Inflows Suggest Institutional Investors Are Moving Back Into The Market

Bitcoin and the crypto market at large had suffered outflows that coincided with the massive sell-offs that rocked the market. This contributed to the downtrend that saw bitcoin touch towards six-month lows while investors who had gotten into the market later suffered massive losses. This outflow trend is beginning to reverse so as bitcoin and other digital assets begin to record inflows after a long drought.

Bitcoin Inflows Back Up

The past week for bitcoin has been an encouraging one. The digital asset is nowhere near its previous highs but had managed to recover from its recent lows. It had run up to $38,000 once again, reinstating some level of faith back in the market. On the institutional investors’ side, this trend, albeit a bit slower, is the same as investors begin to gradually move back into the cryptocurrency.

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In the latest CoinShares report, we see that bitcoin has begun to record market inflows once more. This is a deviation from the end of 2021 and the beginning of 2022 where outflows reached record highs. Greatly impacted by the minutes released by the Fed, bitcoin alone had recorded outflows to the tune of $107 million in a single week, setting a new record.

BTC recovers from market crash | Source: BTCUSD on TradingView.com

However, in the past two weeks, the tide is turning towards inflows as CoinShares reported the first week of inflows after massive outflows. This past week continues to mirror this trend as inflows have continued.

Inflows to bitcoin were reported to total $22 million for last week. A small number compared to what had become the norm by the third quarter of 2021, but a reassuring figure nonetheless. It’s a step up from last week when BTC’s total AuM crashed to a six-month low of $29 billion.

Altcoins Continue To Suffer

Altcoins have not mirrored this movement of bitcoin this time around. Instead, altcoins continue to bear the brunt of the market onslaught as outflows continue to be the order of the day.

Leading altcoin Ethereum has now marked its 8th consecutive week of inflows. In this time period, the altcoin has seen a total of $272 million flow out of the week, marking some of the highest negative sentiment towards the digital asset.

Related Reading | The Uber Rich Investors Are Picking This Altcoin Over Bitcoin

Other altcoins like Cardano, Solana, and Polkadot, which are fast-becoming investor favorites, did not fare well for the week either. All of these digital assets saw another week of outflows.

Multi-asset funds and Blockchain equity investment products deviated from the performance of altcoins. Following in the footsteps of bitcoin, each of them recorded inflows for the week, $32 million for multi-asset funds, and $15 million for Blockchain equity investment products.

Featured image from Bitcoin News, chart from TradingView.com

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Bitcoin Leads As Markets Sees Record Outflows. Bear Market Incoming?

Bitcoin and altcoins have not had the best week according to reports coming out of the market. The crypto market as a whole has been enjoying months of continuous inflows following hot on the heels of the recent market rally. It has pushed crypto-assets such as bitcoin towards new highs as inflows had hit a new record alongside assets under management. But it seems that this is changing.

Coming off the back of what was 17 consecutive weeks of inflows, the market is now seeing movement in the opposite direction. While assets such as ethereum had previously recorded outflows at various times, they had been isolated to a select few. Now the whole market is seeing its first week of outflows after four months of inflows, setting a record at the same time.

Related Reading | Millennial Millionaires Are The Most Bullish On Crypto, Survey Finds

Largest Record Outflows

The total amount of outflows for last week came out to a total of $142 million. This marked the first week of outflows after a 17-week inflows streak that brought assets under management towards record highs. Not only was this the first week of outflows following over four months of inflows, but it is also the largest weekly outflow from the crypto market on record.

This follows an impressive rally from the crypto market where major cryptocurrencies touched towards a new high. There have been sell-offs all across the market as investors have taken profit and institutional investors are not left out. However, the outflows, despite being a record high, represent only a small total (0.23%) of the asset under management and are also meager compared to the outflows of 2018 that touched as high as 1.6% of total AuM.

The total inflows for the year had reached a record high of $9.5 billion, almost 50% higher than the record that was set in 2020 of $6.7 billion. So despite the outflows, inflows for the year still remain at a record high.

CoinShares also notes that the crypto market is not the only one that has recorded outflows either. Risk assets have all seen outflows after the U.S. Fed had released its statement on tapering.

Bitcoin Leads Outflows

Bitcoin took the lead for the asset with the most outflows for the week. The digital asset had seen its price plummet back to below $50,000 since hitting its all-time high of $69K but had continued to maintain inflows in the weeks following that. This marks the first outflows for over 17 weeks but remains firmly below outflows levels recorded in June that touched as high as $150 million.

Related Reading | Struggling Prices Beats Bitcoin Expectations Down From $100K To $50K

Ethereum has alternated between inflows and outflows for the last 17 weeks. The second-largest cryptocurrency also saw record outflows for the week with a total of $64 million in outflows as it continues to counter bitcoin’s outflows.

Solana, Polkadot, and multi-asset investment products were spared of the onslaught as they saw $6.7 million, $2.5 million, and $1.5 million in inflows respectively.

BTC recovers above $48K | Source: BTCUSD on TradingView.com
Featured image from Wikipedia, chart from TradingView.com

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Cardano, Solana Lead Altcoins As Market Sees Record Inflows

Cardano and Solana have led the charge of altcoins in the recent round of inflows into the crypto market. Altcoins saw increased inflows alongside bitcoin, which had seen increasing interest from investors after the first bitcoin ETF had been approved and began trading last week. Last week recorded the highest amount of institutional inflows coming into the market.

Institutional investors are now upping their stake in the market with the recent gains recorded across the market. Most notably has been the price of bitcoin which had broken a new all-time high following the trading of the first bitcoin ETF. The ETF had been released with much success as over $1 billion had been traded within the first 24 hours of the ETF being released. CoinShares released a report showing that institutional investors are not relenting with their investments.

Bitcoin Leads Market Inflows

Although altcoins had seen inflows into both assets last week, bitcoin had once again led the market inflows. The record-breaking inflows saw $1.47 billion flow from institutional investors into the market, and bitcoin accounted for a large portion of it. The amount marked the largest inflows in the space of a week in the market.

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Bitcoin has led inflows in the previous weeks and this past week was no exception. Bitcoin inflows made up 99% of the total institutional inflows. The digital asset alone saw inflows total $1.45 billion last week. Most of this came from trading in the approved bitcoin ETFs that began trading last week.

Additionally, the digital asset saw inflows totaling $138 million into bitcoin products in other regions. CoinShares also reported that there had been records of profit-taking in the market but the volume was inconsequential in contrast to the total inflows.

Cardano, Solana Lead Their Peers

Cardano and Solana recorded the highest inflows for the week for altcoins. Leading altcoin Ethereum had recorded a 3rd consecutive week of outflows from the digital asset, suggesting waning faith in Etheruem. However, other altcoins picked up the slack in this regard.

ADA price slows above $2 | Source: ADAUSD on TradingView.com

Although nowhere near the inflows recorded by top cryptocurrency bitcoin, Cardano and Solana managed to hold their own in the market. Solana took the lead for the altcoin with the highest inflows with a total of $8.2 million for the week. Cardano also recorded a positive week of inflows with a total of $5.3 million flowing into the digital asset.

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Binance also saw a positive week of inflows. However, the asset recorded inflows in volumes much smaller than its peers. Binance saw a total of $1.8 million of institutional inflows in the past week.

The inflows recorded last week bring the total asset under management (AuM) to a new record of $79.2 billion, with a weekly closing of $76.7 billion. Total inflows for the year have now surpassed the record set in 2020 of $6.7 billion with two months left to go in the year.

Featured image from Medium, chart from TradingView.com