Institutional Investors on the Move
Last week saw institutional investors saying farewell to a staggering $101.5 million in digital asset products, and it seems to be all about the fear of the Fed. According to CoinShares, the anticipation of hawkish monetary policies has got investors tightening their purse strings like a belt after Thanksgiving dinner.
Inflation? More like In-flation!
U.S. inflation rates have hit a hair-raising 8.6% year-on-year, the highest since 1981. With wallets feeling the pinch, traders are bracing for the Fed to take significant action. Many are pricing in a trio of 0.5% rate hikes by October, which is about as pleasant as finding out your favorite shirt shrank in the wash.
The Great Digital Asset Drain
According to CoinShares’ latest report, it was American investors leading the charge out of the digital asset pool, offloading $98 million worth, while our friends across the pond in Europe added a mere $2 million to their saltshaker-sized reserves. If only crypto was as stable as your grandma’s fruitcake!
- Bitcoin (BTC): $56.8 million outflows
- Ethereum (ETH): $40.7 million outflows
It’s like a household garage sale that got a bit out of hand. The month-to-date record isn’t looking too rosy either, with total BTC and ETH outflows of $91.1 million and $72.3 million respectively. It’s a crypto winter out there, folks!
Survival of the Fittest: BTC vs ETH
Though CoinShares indicates Bitcoin has been plunged into a crypto winter, it’s worth noting that BTC investment products have still seen robust year-to-date inflows of $450.8 million. In contrast, ETH has faced a notable exodus with $386.5 million of outflows, indicating that institutional sentiments still seem to lean heavily in favor of the digital gold, Bitcoin. Talk about a popularity contest!
The Price Plunge
Between June 6 and June 10, Bitcoin and Ethereum prices dipped 4.7% and 5.9%, respectively. However, hold on to your hats – since June 11, both assets have taken a swan dive, with BTC tumbling around 25.7% and ETH plummeting approximately 33.2%. Ouch!
What’s Next?
Aside from the BTC and ETH rollercoaster, multi-asset funds recorded $4.7 million in outflows while short Bitcoin products saw a slight departure of only $200,000. Meanwhile, investors seem to have turned their noses up at altcoins like a spoiled child at broccoli. With the current state of affairs, it seems everyone’s holding their breath (and their wallets) as they await the Federal Reserve’s next move.
