Beware of the crypto fund bears: for an astonishing eighth consecutive week, negative sentiment continues to proliferate among institutional investors. Large-scale crypto investors withdrew $88 million from digital asset funds last week, resulting in a staggering $417 million total over the two-month period, as revealed by a new report from CoinShares.
CoinShares, a digital asset investment firm, tracks the investment activities of significant exchange-traded products, mutual funds, and over-the-counter (OTC) trusts in cryptocurrencies such as Bitcoin, Ethereum, and other altcoins, presenting its findings in a weekly report. James Butterfill, Head of Research at CoinShares, attributes all the selling to monetary policy, stating that “currently there is no end in sight to interest rate rises.”
This week’s selling pressure primarily emanates from North America, accounting for 87% of total outflows. Canadian-based fund 3iQ led the way with $76.9 million worth of selling, contributing to a total of $286 million for the year. In contrast, Swiss funds saw inflows of $9.2 million, whereas Germany experienced $9.4 million in outflows.
The current week’s markedly pessimistic sentiment deviates from last week’s relatively neutral position held by institutional investors. Among digital assets, Bitcoin saw the largest outflows of $52 million over the past seven days. Institutional investors have heavily offloaded the largest cryptocurrency this year, totaling an impressive $172 million.
Short interest for Bitcoin has declined, with outflows standing at a meager $1.1 million for the week. Ethereum followed in second place for weekly outflows, amounting to $36 million. However, this figure represents the most substantial single week of selling since The Merge in September last year. Total withdrawals from Ethereum-based funds for 2023 currently rest at $72 million.
Altcoin-based funds yielded mixed results with institutional investors. Litecoin (LTC), Solana (SOL), and Ripple (XRP) recorded inflows, though each amounted to less than $1 million. In contrast, Polygon (MATIC)-based funds experienced the largest sell-off for the week, at $400,000.
Interestingly, and in opposition to Bitcoin and Ethereum, these blue-chip cryptocurrencies have witnessed year-to-date inflows, with Solana leading the pack at $13 million. Although it’s uncertain whether institutional investors drive this trend, the top cryptocurrencies have seen red candles for the week. Bitcoin lost 3.5% of its value in the past week, while Ethereum witnessed an even more significant decline with a 7.2% loss over the same period, according to Coingecko.
Source: Decrypt
