Bitcoin Sees Massive Outflows In CoinShares’ Latest Report

CoinShares’ latest report shows a $32 million outflow in investment products linked to digital assets, notably Bitcoin, in the past week. This marks the most substantial outflow since Dec 2022.

The negative sentiment significantly impacted Bitcoin, resulting in nearly $25 million in outflows. Conversely, short-Bitcoin investment products saw inflows of $3.7 million.

Mid-week, outflows reached $62M, but by Friday, sentiment improved, resulting in $30M inflows. Despite the negativity, Bitcoin’s price rose by 10% during the week, not reflecting the view.

Total assets under management (AuM) reached $30 billion, their highest level since Aug 2022, due to price appreciation. The report proposes that ETP investors may have lower optimism toward US regulatory pressures than the broader market.

Other cryptocurrencies, such as Ethereum, Cosmos, Polygon, and Avalanche, had mixed sentiments. They saw outflows of $7.2M, $1.6M, $0.8M, and $0.5M, respectively, excluding BTC.

Aave, Fantom, XRP, Binance, and Decentraland received inflows between $0.36M to $0.26M, while blockchain equities got $9.6M last week. Blockchain equities had six straight weeks of inflows, indicating positive investor sentiment compared to crypto assets. Among cryptocurrencies, Aave, Fantom, XRP, Binance, and Decentraland, I received moderate inflows, whereas blockchain equities had a substantial influx.

The Significance Of Inactive Bitcoin Wallets: A Closer Look

Another phenomenon has recently grabbed the attention of the crypto community. Inactive Bitcoin wallets have suddenly increased in quantity, which has piqued interest. According to a tweet by analytics firm Glassnode, the amount of BTC supply that has not been active for 5-7 years has reached a 5-year high. Presently, the amount stands at 1,611,029.492 BTC, valued at over $80 billion at current market prices.

Over 1.6 million BTC has been idle in inaccessible addresses for at least five years. This increase in inactive Bitcoin wallets carries significant implications for a couple of reasons. BTC holders are holding coins long-term with no plans to sell, indicating firm conviction in investment.

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Another point to consider is that this indicates the steadfast confidence of long-term holders in the future potential of Bitcoin as they continue accumulating it with a firm belief in its value appreciation. In addition, Glassnode’s findings disclose a noteworthy trend of an upsurge in the amount of Bitcoin held in these inactive wallets by more than 400,000 BTC in the past year.

This article conveys general information and the opinions expressed should not be considered personal advice for any individual or specific security or investment product.

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