The latest weekly report of CoinShares reveals that crypto investment products, particularly Bitcoin funds, saw major outflows for the third consecutive week. As investors continue to take profits, a total of $107 million in outflows were recorded in the previous week.
Crypto investment products featured in the report come from several exchange-traded product (ETP) providers, including 21Shares, Grayscale Investments, Bitwise, and Proshares. However, it was found that a significant portion of outflows came from Purpose Investments and ETC issuance.
From a regional standpoint, CoinShares found outflows came primarily from Germany and Canada, which registered $70.8 million and $28.5 million, respectively. Meanwhile, only Australia and the United States saw inflows, with $0.3 million and $0.2 million respectively.
Bitcoin funds record $111 million in weekly outflows
Bitcoin (BTC) was primarily responsible for the significant outflows recorded by digital asset investment products in Week 32 of 2023, according to CoinShares lead researcher James Butterfill. The leading cryptocurrency saw total outflows of $111 million, the largest since March.
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It appears that investment in Bitcoin-related funds is slowing as institutional investors continue to sell for profit. This latest report represents the third consecutive week in which Bitcoin funds experienced outflows totaling $139 million.
Prior to this recent negative run, more than $742 million went into crypto funds over a four-week period, with Bitcoin receiving a large chunk of that amount. This positive momentum is believed to have been spurred by Ripple’s partial victory over the US Securities and Exchange Commission.
CoinShares’ weekly report revealed that outflows into short Bitcoin have stopped for the first time in more than three months. While this may indicate that institutional investors are no longer betting on the BTC price, the weekly outflows indicate that they are not counting on the rise either.
To be clear, short products allow investors to profit when the price of a cryptocurrency – in this context Bitcoin – falls. It usually involves borrowing Bitcoin, selling it immediately on the open market, and then buying it back at a lower price to pay back the loan.
At the time of writing, Bitcoin is trading at $29,164, with a 0.5% price increase in the past day. According to CoinGecko Datathe cryptocurrency continues to lead the market with a market cap of approximately $567.3 billion.
“Altcoins Sentiment Appears to be Improving”
As institutional investors continue to reap profits from various Bitcoin-related funds, the signs appear positive for most altcoin investment products. According to CoinSharesaltcoins (except Ethereum) recorded $3 million in outflows in week 31 of 2023.
This trend appears to be gaining momentum as Solana (SOL) in particular saw a substantial increase in buying pressure from institutions in Europe and the United States in week 32 of 2023. The cryptocurrency registered $9.5 million in weekly inflows, its highest figure since March 2020.
Ripple (XRP) and Litecoin (LTC) also saw weekly inflows, with $0.5 million and $0.46 million respectively. Uniswap and Cardano, on the other hand, saw outflows of $0.8 million and $0.3 million, respectively.
BTCUSDT trading at $29,350 | Source: daily BTCUSDT chart from TradingView
Featured image from iStock, chart from TradingView