Here’s How Institutional Investors React to the Sell-Off in the Cryptocurrency Market

Since 2017 and 2018, bitcoin and other cryptocurrencies in the market have had the longest unfavorable price trend. After a major rally in 2021, the overall cryptocurrency market lost $2 trillion. However, despite the sporadic rise, during these months, the value of the cryptocurrency tends to fluctuate more in the direction of the red lines.

Last week, digital asset investment products saw a small outflow of $9 million despite a sell-off across the market. Bitcoin (BTC) withdraws $15 million for the third consecutive week, while Ethereum (ETH) reported $3 million inflows last week, according to CoinShares digital asset fund flows. In light of the September 15th merger, it appears that investors are more optimistic about Ethereum than Bitcoin.

According to the study, investments in digital assets lost only $9 million last week. In addition, the volume of products for investment in digital assets reached $1 billion, which is still below the average for the year by 55%.

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The analysis shows that due to pressure from the cryptocurrency market, the level of investor involvement is now low. The US, Germany and Sweden are the countries with the most releases. In contrast, Brazilian, Swiss and Australian investors are investing in cryptocurrency investment products.

Why are there exceptions?

For the third consecutive week of withdrawals, $15 million was withdrawn from Bitcoin investment products. Due to the FUD, there is some negativity surrounding the Fed’s rate hike around Bitcoin. However, short bitcoin recorded a small influx of $0.2 million last week. BTC price fell below $21,000 after the latest bear market rally failed to keep it above $25,000.

$3 million has been invested in Ethereum related products. This ends a nine-week streak of $162 million in receipts. Better communication about the merger and its timing is a source of current inflows. On September 15, Ethereum core developers pushed for a merger.

Small inflows have been seen in investment products for Cardano (ADA), XRP and Binance Coin (BNB), among other altcoins. However, Solana (SOL) recorded a second-week outflow of $1.4 million. Institutional investors are watching the rally in the cryptocurrency market. Last week, $1.6 million was mined from the cryptocurrency market for blockchain products.

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