Flagship cryptocurrency, Bitcoin, only reached a high of $42,000 in late July before correcting by over 5% as a new month begins. While this happened, the demand for the crypto asset by institutional investors also plunged. BTC’s $42k high on July 31 was its first since seven weeks, following the market decline in mid-May.
Meanwhile, CoinShares, a leading crypto asset management firm, also reported outflows on its crypto investments. According to its weekly report on its digital assets investment, BTC investments products witnessed substantial outflows. The report noted that CoinShares shed about $20 million from its BTC derivatives a week ago.
Ethereum Outflows at $9.5 Million, Says CoinShares
While for the largest altcoin by market capitalization, Ethereum, CoinShares registered $9.5 million outflows on derivatives of the crypto asset. In contrast, on its multi-asset crypto derivatives, it recorded a total inflow of $7.5 million. Bitcoin outflows are happening for the 4th week in a row.
However, inflows from the start of the year till date amounts to a high of $4.1 billion. On their part, ETH derivatives have witnessed outflows for the second week in a row. Of the last 12 weeks, outflows on BTC were observed in 10 weeks; while ETH outflows went on for 6 weeks, as investors soft-pedalled on exchanging ETH derivatives.
As reported, the Bitcoin network has been witnessing increased activity beginning from late July. The short spike to $42,000 must have been behind the traffic. As this happened, crypto analytics firm Glassnode also observed a 30% increase in active Bitcoin addresses. Glassnode reported that active addresses increased over the previous week from 250k to 325k
Over $1 Billion Bitcoin Moved from Coinbase
In a related development, blockchain tracking service, Whale Alert declared BTC transfers of over $1billion from leading crypto exchange, Coinbase to unknown digital wallets. The transfers took place at three different intervals and in separate amounts. Santiment reported in one of its data, that whales have accumulated 170,000 Bitcoins in the last four weeks.
The number of Bitcoins being held by whales already holding between 100 and 10,000 Bitcoin is now at 9.23 million, pointing to a rise in accumulation. However, some experts are of the opinion that institutional demand for Bitcoin is on a decline.
Bitcoin’s dominance has leaped to a high of 48% and price has fallen to $38k, leading to speculations that the bears are not yet done with their reign. The expectations of investors were high following the spike to $42,800 as they moved their assets off exchanges to digital wallets. Perhaps the latest retracement might herald the next bullish trend, which would see Bitcoin exceed its previous all-time high of $65k. Ethereum is still trading at the $2,500 region after touching $2,800 a week ago.
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