Institutional crypto fund flows turn negative as markets decline

Digital asset investment products are back in negative territory after four weeks of solid inflows.

According to asset manager CoinShares, a total of $6.5 million was withdrawn from crypto funds last week, reversing the trend of inflows.

However, the outflow is modest compared to the previous four weeks, which saw a total inflow of $742 million.

🔎 Let’s take a look at last week’s fund flows with James Butterfill, Head of Research at CoinShares.

⬅️ Digital asset investment products saw modest outflows totaling US$6.5m, following inflows from the previous 4 weeks, which totaled US$742m.

🧵1/5 pic.twitter.com/I32OtNbGV5

— CoinShares (@CoinSharesCo) 24 July 2023

Switch to Pro Investor ETH Fund

Bitcoin saw the bulk of outflows, with $13 million leaving such funds and products. In addition, short BTC investment products saw outflows totaling $5.5 million for the 13th week in a row.

The paper also showed a drop in trading volume in the past week. They were below the year-weekly average of $1.2 billion, which was less than half of the previous week’s volume of $2.4 billion.

The negative sentiment was mainly focused on the North American market as the regulatory war on crypto continues.

However, the news was not all bad in the world of institutional investing. Professional traders move from bitcoin to ethereum, with ETH-based funds seeing an inflow of $6.6 million for the week.

“This suggests that sentiment, which has been poor this year, is slowly starting to turn,” CoinShares said.

Ripple-related funds also saw an inflow of $2.6 million due to the company’s recent partial victory against the SEC and XRP price.

The report showed that Solana, Uniswap and Polygon saw total inflows of $1.1 million, $0.7 million and $0.7 million respectively.

However, the overall picture could be an indication that sentiment is about to turn negative. The trend has been reversed due to lower weeks of institutional flows after the earlier big weeks.

Crypto market continues to slow down

Volatility, volume and liquidity in the crypto market are at multi-year lows as asset prices remain stable.

Total market cap fell 1.4% on the day to $1.21 trillion, but remained within its narrow multi-monthly range.

Bitcoin price declined by 2.3% as the asset dropped to $29,000 and sentiment turned weak. The asset is currently trading at its lowest level in more than a month.

Ethereum is moving into its shadow, down 1.2% at the time of writing, at $1,847. Rest of the altcoins are a sea of ​​red except for Dogecoin, which is up 9% on the day.