There has been a long-term downward trend in the price of Bitcoin and other cryptocurrencies since 2017 and 2018. Crypto markets have lost $2 trillion since the significant rally of 2021. While cryptocurrency values fluctuate sporadicling these months, they tend to correlate more with the red lines.
A significant market sell-off did not stop $9 million from flowing out of digital asset investment products last week. Cryptocurrency CoinShares’ Digital Asset Fund Flows reported a $15 million withdrawal last week from Bitcoin (BTC) that was followed by a $3 million inflow from Ethereum (ETH) over the same period. Ethereum appears to be more popular among investors than Bitcoin due to the upcoming Merge on September 15.
A mere $9 million was lost last week by digital asset investments, according to the research. Furthermore, a total of $1 billion was invested in digital assets, a decline of 55% from the past year.
The analysis indicates that investor engagement has decreased due to the cryptocurrency market’s pressure. In terms of outflows, Germany, the U.S., and Sweden were the top three countries. Cryptocurrency investment products are popular with Brazilian, Swiss, and Australian investors.
Why are There Withdrawals Happening?
There were withdrawals of $15 million from Bitcoin investment products for the third consecutive week. Bitcoin has been negatively affected by the Fed’s rate hikes due to the FUD surrounding them. In contrast, short bitcoins influxed $0.2 million last week. Despite the most recent rebound in the bear market, Bitcoin’s price fell beneath 21,000 after failing to surpass $25,000.
Products related to Ethereum were invested in for $3 million. The inflows have been steady for the past nine weeks, totaling $162 million. Inflows have been sustained due to improvements in communication and timing regarding the Merge. It was announced on September 15 that Ethereum core developers were pushing for a merge.
Other altcoins such as Cardano (ADA), XRP, and Binance Coin (BNB) also saw some small inflows. The second-week outflows for Solana (SOL) were $1.4 million. Cryptocurrency market participants are watching for a rally. Cryptocurrency outflows for blockchain products totaled $1.6 million last week.
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