2024-6-27 22:00 |
Bitcoin-based crypto investments have witnessed another week of outflow in what was an unpleasant week for Bitcoin and other cryptocurrencies. Bitcoin investors, in particular, were disappointed as they watched the price of the world’s biggest asset decline during the week, temporarily falling below $60,000. According to recent inflow data from CoinShares, this correction also flowed into crypto investment products. Notably, crypto investment products registered $584 million outflows last week to extend outflows to $1.2 billion in two weeks.
True Correction Is Underway For BitcoinAccording to the CoinShares report, most of the outflows were concentrated toward Bitcoin, with the crypto’s investment products registering $630 million last week. As the report noted, this outflow sentiment can be largely attributed to a growing pessimism amongst crypto investors for interest rate cuts by the FED this year. Furthermore, the continued outflow suggests that a true correction might be underway for Bitcoin.
However, while this correction might be going on, it might not necessarily translate to a completely negative sentiment for Bitcoin. Such an inference is made in light of a corresponding $1.2 million outflow in short Bitcoin products, which suggests that the majority of investors do not believe that Bitcoin will continue to decline over the long run.
In terms of geographical location, the US saw the largest outflows, totaling $475 million. Interestingly, a majority of this recorded outflow originated from Spot Bitcoin ETFs trading in the US. According to data, Spot Bitcoin ETFs witnessed outflows every day last week, causing the lowest trading volume of $6.9 billion in investment products since their launch in January 2024. Outflows were also seen in Canada, Germany and Hong Kong at $109.3 million, $23.8 million and $19.3 million, respectively.
Ethereum, which had also been coming from an unpleasant week of price action, wasn’t left out of the negative sentiment and registered $58 million in outflows, its biggest weekly outflow in 2024.
Deviating from the outflow trend, many altcoin products witnessed surprising weekly inflows despite price declines on the spot market. This was headed by multi-asset products, which saw $98 million in inflows. Solana, Litecoin and Polygon also had inflows of $2.7 million, $1.3 million, and $1 million, respectively.
More Price Correction Ahead?This week will be crucial in determining whether Bitcoin and other cryptocurrencies will continue to experience price corrections. Time will tell if the recent volatility is a sign of further declines or a temporary dip. However, the price action observed in the past 24 hours suggests that the correction might be nearing its conclusion.
Bitcoin, Ethereum, Solana, and many other cryptocurrencies have rebounded significantly, showing notable price increases over the past day. If sustained in the spot market, this upward trend could potentially lead to increased inflows into crypto investment products by the end of the week.
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