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Record Institutional Outflows Hit Crypto Market

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Yesterday, the crypto market cap dipped below $1.9 trillion for the first time in nearly three months. Leading crypto assets like Bitcoin and Ethereum led the bearish move in the market. BTC plunged below $40,000 and ETH failed to retain the $3,000 price level.

The recent crypto correction was fueled by panic among institutional investors. The weekly digital asset fund flows report posted by CoinShares shows that digital asset investment products witnessed outflows totaling $207 million last week, the highest level on record.

Bitcoin-related investment products saw institutional outflows worth $107 million. Ethereum came at the second spot with total weekly outflows of $39 million. In the last 5 weeks, ETH witnessed institutional outflows worth $200 million.

“Crypto investment products saw outflows totaling a weekly record of US$207m. This follows the outflows that began mid-December and the 4-week run now totals US$465m, representing 0.8% of total assets under management (AuM), bringing a sharp stop to US$3.6bn of inflows that began in August 2021. Bitcoin saw outflows totaling US$107m last week in what we believe was a direct response to the FOMC minutes which revealed the US Federal Reserve’s concerns for rising inflation, and the fear amongst investors of an interest rate hike,” the report noted.

Weakness in Ethereum?

In 2021, Ethereum performed better than Bitcoin in terms of price. The crypto asset saw substantial gains in its market cap and attracted large institutional investors. However, this year started on a negative note for the second most dominant digital asset. ETH has lost approximately 25% of its value in the first 10 days of 2022. A major reason behind ETH’s recent weakness is large institutional outflows from ETH investment products.

“Ethereum saw outflows totaling US$39m last week, bringing the 5-week run of outflows to US$200m. On a proportional basis, this is far greater than Bitcoin’s outflows representing 1.4% of AUM,” CoinShares explained.

Yesterday, the crypto market cap dipped below $1.9 trillion for the first time in nearly three months. Leading crypto assets like Bitcoin and Ethereum led the bearish move in the market. BTC plunged below $40,000 and ETH failed to retain the $3,000 price level.

The recent crypto correction was fueled by panic among institutional investors. The weekly digital asset fund flows report posted by CoinShares shows that digital asset investment products witnessed outflows totaling $207 million last week, the highest level on record.

Bitcoin-related investment products saw institutional outflows worth $107 million. Ethereum came at the second spot with total weekly outflows of $39 million. In the last 5 weeks, ETH witnessed institutional outflows worth $200 million.

“Crypto investment products saw outflows totaling a weekly record of US$207m. This follows the outflows that began mid-December and the 4-week run now totals US$465m, representing 0.8% of total assets under management (AuM), bringing a sharp stop to US$3.6bn of inflows that began in August 2021. Bitcoin saw outflows totaling US$107m last week in what we believe was a direct response to the FOMC minutes which revealed the US Federal Reserve’s concerns for rising inflation, and the fear amongst investors of an interest rate hike,” the report noted.

Weakness in Ethereum?

In 2021, Ethereum performed better than Bitcoin in terms of price. The crypto asset saw substantial gains in its market cap and attracted large institutional investors. However, this year started on a negative note for the second most dominant digital asset. ETH has lost approximately 25% of its value in the first 10 days of 2022. A major reason behind ETH’s recent weakness is large institutional outflows from ETH investment products.

“Ethereum saw outflows totaling US$39m last week, bringing the 5-week run of outflows to US$200m. On a proportional basis, this is far greater than Bitcoin’s outflows representing 1.4% of AUM,” CoinShares explained.



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