The reaction of institutional investors to the drop in the bitcoin price has been similar to that of retail investors. After weeks of outflows, the tide has begun to turn, largely attributed to lower prices that give the digital asset a chance to come in before a recovery. The past week saw an influx for digital assets, though other assets tell a different story.
bitcoin sentiment recover
Bitcoin sentiment turned negative after last week’s price drop. It started a massive selloff across the space, with the digital asset reaching a low of $17,600. However, not everyone in this area saw the fall in prices as a sell signal. For some, this presented a unique opportunity to get some ‘cheap’ bitcoins, similar to those seen in institutional investors.
Bitcoin outflows were intensified over the past week due to lower market momentum. It got better last week when the outflow trend was canceled and money started flowing into the cryptocurrency.
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The major cryptocurrency was the biggest gainer from this turning point in investor sentiment as it saw $28 million in inflows for the week. Now, that’s not really an impressive figure when it comes to the influx of bitcoin. However, it is important not only because of the market sentiment, but also the outflows because of the market’s characteristic for the past week. This brings the total month-to-date inflows for bitcoin to $46 million.
Still, short bitcoin was gone the other day. The asset saw record outflows over the past week. With a total of $5.8 million, short bitcoin embodied the recent negative sentiment felt across the market after hitting a new high of $64 million earlier in the week.
BTC begins another decline trend | Source: BTCUSD on TradingView.com
outflow rock the rest
It looks like bitcoin will be one of the sole beneficiaries of the influx trend over the past week. For the rest of the market, the selling trend had taken a stronghold and saw an influx of $39 million in digital asset investments. This brings the total assets under management to $36 billion. It is now sitting at its lowest point in more than a year, accounting for a 59% drop in the past six months alone. However, year-on-year net inflows remain positive at $403 million.
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Ethereum is yet to break free from its bearish grip as the date of the outflow remains in sequence. Ethereum outflows reached $70 million in the past week alone. The second largest cryptocurrency by market cap has now had 11 consecutive weeks of outflows and there is no respite in sight. Its year-over-year outflow now sits at a massive $459 million.
However, the multi-asset investment product and Solana will go the way of bitcoin last week. Both these asset classes stubbornly maintain the inflow trend. Inflows for multi-asset investment products came in at $9 million, while Solana saw an inflow of $0.7 million, possibly from investors who are exiting competitor, Ethereum, due to fears that the merge will not go according to schedule.
The crypto market has lost more than $100 billion since last week. At the time of this writing it is currently sitting at $892.6 billion.
Featured image from US News Money, chart from TradingView.com
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