Institutional investors dumped $101.5 million worth of digital assets last week in “anticipation of hawkish monetary policy” from the US Federal Reserve, according to CoinShares.
At the end of May, US inflation reached 8.6% year on year, marking a return to levels not seen since 1981. three more rate hikes of 0.5% by October.
According to the latest version According to CoinShares’ weekly report on digital asset fund flows, the outflow between June 6 and 10 was mainly driven by investors from America and amounted to $98 million, while Europe accounted for only $2 million.
Products offering access to the two main crypto assets, Bitcoin (BTC) and Ethereum (ETH), accounted for nearly all of the $56.8 million and $40.7 million outflows. The figures for the month also paint a grim figure of $91.1 million in BTC product outflows and $72.3 million in total ETH product outflows.
“What has pushed Bitcoin into a ‘crypto winter’ over the past six months can be broadly explained as a direct result of the increasingly hawkish rhetoric of the US Federal Reserve.”
While CoinShares has suggested that Bitcoin has entered a crypto winter, YTD (YTD) inflows for BTC investment products are still $450.8 million. In comparison, funds offering access to ETH have experienced a significant $386.5M outflow since the start of the year, suggesting that sentiment among institutional investors is still largely in favor of digital gold.
The report also highlights that total assets under management (AUM) for ethereum funds “fell from a peak of $23 billion in November 2021 to $8.7 billion” as of last week.
Notably, institutional investors got rid of their BTC and ETH products before much of the latest price carnage happened to both assets.
The price of Bitcoin has fallen to its lowest level since May as the Ethereum market trades at an 18.4% loss.
According to data from CoinGecko, between June 6 and 10, the price of BTC and ETH fell by 4.7% and 5.9% each. However, since June 11, BTC and ETH have fallen by around 25.7% and 33.2%, respectively.
In addition to the outflow of BTC and ETH, multi-asset funds saw an outflow of $4.7 million, while Short Bitcoin products showed a minimum outflow of $200,000. At the same time, investors also “avoided increasing positions in altcoins.”
Credit : cointelegraph.com