Bitcoin Crash Sends Institutional Investors to the Hills


Small and retail investors are not alone in being hit hard by the Bitcoin crash. Institutional investors are also feeling the heat of the market crash. This has sent institutional investors racing as inflows stalled for the past week. The outflow of crypto- and blockchain-related investments grew steadily over the weeks, totaling more than $100 million.

Institutional investors stay away

The institutional outflow for last week were worrisome for crypto investors, but not surprising in any way. With the rise of the ‘crypto winter’, it has signaled that the bear market is in full swing. Investors are thus forced to react accordingly.

Outflows had surged in the past week and totaled $102 million. It culminates in a long-running outflow trend that had largely remained in the altcoins. This time, however, bitcoin has pulled into this trend.

Related literature | Bitcoin plunges to 18-month lows, has the market seen the worst?

The pioneer cryptocurrency saw outflows totaling $57 million last week alone. This was the case for the short bitcoin investment products which also saw an outflow. For bitcoin, these weekly outflows bring the monthly outflow to $91 million. Short bitcoin investment products now see only $55 million in total assets under management (AuM) compared to $27 billion for its longer-term bitcoin investment products.

Total Market Cap Drops Below $1 Trillion | Source: Crypto Total Market Capitalization on TradingView.com

Outflows All Over Crypto

Ethereum had registered consistent weeks of outflows over the past few months, and this past week was no different. The second-largest cryptocurrency by market cap saw $41 million in outflows in the past week. This brought the year-to-date outflow to $387 million, which now makes up just 4.4% of total crypto assets under management.

Blockchain quidditions have also entered the league of outflows in the past week with a total of $5 million. As well as multi-asset investment products that saw a $4.7 million outflow. Most of the outflow recorded last week came from the Americas, amounting to more than $98 million outflow. Their European counterparts registered just $2 million in outflows during the same period.

Related literature | Exchange Inflows Rising As Crypto Investors Cry To Exit The Market

What this shows is the general sentiment of investors towards the crypto market, regardless of which avenue they have invested through. The bear market is expected to last at least another year and as such, investors have begun to plan accordingly.

Cryptocurrency market cap has now fallen below $1 trillion for the first time since January 2021. With sentiment moving strongly to the negative, there is no sign of recovery or relief for investors.

Featured image of The Financial Express, chart from TradingView.com

Follow Dear Owie on Twitter for market insights, updates and the occasional funny tweet…



Leave a Reply

Your email address will not be published.