Institutional Crypto Investment Products Turning Red

No one will have noticed that the cryptocurrency market is not in its best shape. Especially when we consider that the technical upswing that started a few weeks ago is clearly showing signs of fatigue. A situation where the number of investors falls, while those who decide to stay take the opportunity to “sell” for months. A situation that obviously does not spare institutional structures, which are little known for reckless risk-taking. And of course, the current period also sees red in the field.

There is no reason to believe that the current bearish situation could yield a favorable outcome both in the cryptocurrency sector and elsewhere. Certainly not in the camp of those who invest in numbers rather than fundamentals.. Because on the part of Bitcoin maximalists, the certainty that it will withstand the crisis remains very present. Even if, at this point, the correlation with the stock market indicates that nothing is certain in the field.

Correlation Bitcoin vs Ethereum vs S&P500 – Ecoinometrics

A situation where many investors are moving away from Bitcoin and the broader cryptocurrency market. With a very clear accelerating trend in recent weeks regarding: institutional structures. In any case, this is what the latest “weekly digital asset fund flow report,” published by investment firm CoinShares, appears to be revealing.

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CoinShares – 55% lower than the annual average

What the latest CoinShares structure weekly report reveals only confirms the current trend. Indeed, it appears that the volumes recorded in the institutional investment sector are at their lowest in recent weeks. With an estimated total of “only” $1 billion in the past week, or 55% less than the annual average which shouldn’t be very high already. Which currently equates to the second lowest performance of 2022.

Digital asset investment products saw small outflows totaling $9 million over the period last week. With volumes of $1 billion, 55% below the annual average and the second lowest level this year, indicating low investor participation at the moment. »

CoinShares

A situation that mainly affects Bitcoin, “at which a slight negative feeling has focused”. Because the latter is currently in the red for the third consecutive week, with an outflow ($15.3 million) that is greater than an inflow ($0.2 million). All this in the various markets for ETFs, ETPs and other specialized funds issued by structures such as Grayscale, ProShares or, in this case, CoinShares.

Ethereum – Driven by The Merge prospect

However, things seem more favorable for Ethereum in the same period. This is mainly because of the perspective of The Merge and the merger into Proof of Stake. To the point that the Chicago Mercantile Exchange (CME) is being encouraged to launch a new option on Ether futures even before the effective validation of this historic deadline. And to see “weekly entries totaling $3 million” for the past week. And a “turn in sentiment” observed from mid-Juneaccording to data from CoinShares.

By mid-June, Ethereum investment products had annual outflows totaling $459 million. Since then, as the merger has improved, Ethereum has had a 9-week inflow streak totaling $162 million. »

CoinShares

Ethereum

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However, the picture remains rather bleak for the institutional investment sector. Because in the past week a total of $8.7 million came from these various investment products for the cryptocurrency sector. And again, there is no indication that this trend can be reversed in the short or even medium term…

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