Poor BTC Sentiment Drives Fifth Week of Crypto Outflows by Coinshares
Over the previous five weeks, outflows of all digital asset securities totaled $232 million with BTC-related funds being the main victims according to Coinshares.
The opinion of institutional investors towards digital assets continued to deteriorate last week, as poor sentiment surrounding Bitcoin caused yet another week of withdrawals of funds from digital asset investment vehicles. The newest issue of CoinShares' Digital Asset Fund Flows Report, which was released on May 22 and details outflows for crypto funds, shows that from May 15 to May 19, a total of $32 million was lost. The defeats have now occurred five weeks in a row.
James Butterfill, the head of research at Coinshares, observed that the majority of the unfavorable sentiment focused on Bitcoin, following a pattern over the previous five weeks. The most recent week of institutional selling now represents outflows of $232 million for the time period. Looking over the five-week period from April 21 to May 19, BTC's price dropped by about 4.8% to $26,842. According to CoinGecko, the price of Bitcoin at the time of writing is $27,021.
Tweet by James Butterfill
Bitcoin price has reportedly been stagnant for the past several weeks according to market analyst Yashu Gola of Cointelegraph, as traders wait for the next potential economic trigger that could significantly push BTC price in either a positive or negative direction. Gola cited as a prime illustration of this the Federal Reserve's upcoming decision to raise interest rates, which will take place in June.
Institutional Dumping of BTC
In May alone, there were $112 million in withdrawals from Bitcoin investment products, according to Butterfill, while outflows from short-term Bitcoin products were $34.8 million in May.
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The most recent week, however, witnessed $33 million in withdrawals from BTC goods, which were largely offset by inflows of $1.6 million to multi-asset products, $300,000 to Litecoin (LTC) products, and $200,000 to Ripple (XRP) products.
Investors reduced their exposure by $1.3 million for short-Bitcoin funds, which had the second-largest amount of withdrawals for the week. Products connected to Ether (ETH) were closely following, with outflows totaling $1 million. Germany topped the outflows for the week with $24.1 million, when broken down by exchange nation. U.S. exchanges, with $5 million, came next. Notably, this is in spite of the innovative Markets in Crypto-Assets (MiCA) rule, which in principle should be bullish for the European crypto market, being unanimously approved by the Economic and Financial Affairs Committee of the European Union on May 16.
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