The fluctuations in the cryptocurrency market have led to “fickle investors with some seeing this as an opportunity while the aggregate sentiment is predominantly bearish,” according to CoinShares’ latest Digital Asset Fund Flows Weekly report. Following the data from the report, outflows in the Americas totalled $154 million in the previous week, while inflows in Europe totalled $12.4 million.
The report also reveals that bitcoin investment products now have a total of $38 billion in assets under management, the lowest level since July 2021. While Bitcoin experienced $154 million in outflows over the previous week, its year-to-date and month-to-date flows remain positive.
Though Bitcoin and short Bitcoin flows were negative in the last week, institutional investors have been diversifying their holdings through multi-asset investment products, which resulted in inflows of $9.7 million.
[2/4] Bitcoin was again the primary focus with a swing from inflows the prior week to outflows totalling US$154m last week, while short bitcoin saw outflows totalling US$1.1m.
— CoinShares 👩🚀 (@CoinSharesCo) May 23, 2022
Institutional investors may view these multi-asset investment products as ”safer relative to single line investment products during volatile periods.”
Out of the numerous crypto-asset investment options available, institutional investors are betting on Cardano and Polkadot, having poured $1 million each into their investment products. XRP, Solana ($SOL) and Litecoin ($LTC) products also saw positive inflows of $700,000, $500,000 and $100,000 respectively.
According to the firm, blockchain equity investment products have seen outflows totalling $20 million in the last week.
According to reports, Peter Smith, CEO of leading cryptocurrency exchange and wallet provider Blockchain.com, has warned that more cryptocurrency destruction is on the way, but he believes this type of destruction will result in a stronger business in the long run. Crypto investors should use this as a reminder to dollar-cost average into their positions to reduce their exposure to abrupt bouts of volatility.
Su Zhu, co-founder of cryptocurrency trading and venture capital firm Three Arrows Capital, recently revealed that he notices multiple signs that Bitcoin ($BTC) is reentering an accumulation range after plummeting for seven consecutive weeks for the first time in its history.
The co-founder of the cryptocurrency hedge fund also stated that Bitcoin has been performing well relative to equities, despite Bank of America analysts noting that the flagship cryptocurrency has been failing as an inflation hedge due to its correlation with equities.