By Shelly Melancon (Switzerland)
Bitcoin’s assets under management (AUM) market dipped by nearly 10% for the first time in 5 months. Since July this year, Bitcoin’s AUM has never dipped below $49 billion. This represents its biggest drop since then, an indication that investors are having a difference in sentiment. But it is not only BTC’s AUM that has changed.
Ethereum’s AUM changed, but for the better. A 5.4% increase moved it to$16.6 billion. Data from CryptoCompare, a crypto data analysis firm, shows that the total AUM for the cryptocurrency market fell by 5.5% in November to hit $70 billion. That this occurred during the weekend when BTC experienced a price drop is an interesting fact.
The drop in the total crypto AUM, which was caused by BTC AUM’s drop, indicates that investors are increasingly looking at altcoins to hedge against inflation. Ethereum’s AUM shows increased confidence from investors that the coin is a good alternative to Bitcoin for storing value. It is also the first time since June when Ethereum’s AUM will rise by such a margin.
Grayscale, one of the biggest BTC holders in the market, has 76.8% of the total crypto market AUM. Grayscale is followed by XBT and 21Shares with 7.2% and 3.6% respectively. The recent dip in Bitcoin reduced the actual value of the BTC sum on Friday. Despite the dip, BTC seems to be on the road to higher prices today.
Also read:Bitcoin Recovered Yesterday
Bitcoin has since recovered by 7% on Sunday to hit $58,000 after its black Friday crash. The crash was occasioned by the discovery of a new coronavirus strain, omicron, in South Africa. The outbreak of omicron caused investors to panic sell their BTC assets on various crypto exchanges, leading to a price drop.
cryptoCompare’s report showed that there was an increase in the average amount invested in BTC, TRX, ADA, and ETH in November.
Bitcoin now trades at $57,450 as it prepares to retest the $58,000 resistance. Breaking that mark could see BTC well on its way to a new all-time high, analysts say. The previous prediction of BTC hitting $100,000 by the end of this year now looks impossible, given that it would have to do about 75% profit to hit that mark.
Crypto Exposure is Growing
Some financial institutions increased their BTC exposure in November. One of them is Morgan Stanley. The investment banker is said to have bought some shares at Grayscale. The bank reportedly filed with the SEC to make the purchase official.
Crypto exposure has continued to grow in the US financial sphere with more companies offering crypto exposure whereby investors can perform crypto-based trade without holding or owning the underlying asset. The SEC has received a number of applications to approve Bitcoin spot and futures ETF.
The SEC has however approved only Bitcoin futures ETFs. Earlier in November, it rejected a Bitcoin spot ETF, calling it a more risky instrument than the Bitcoin futures ETF.
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