Institutional investor sentiment over digital assets took another beating last week, with “poor sentiment” around Bitcoin (BTC) leading to yet another week of outflows of digital asset investment products.
According to CoinShares' latest edition of its “Digital Asset Fund Flows Report,” published on May 22, outflows for crypto funds totaled $32 million between May 15 and May 19, marking the fifth week of outflows in a row.
CoinShares Head of Research James Butterfill noted that similar to a trend over the last five weeks, most of the negative sentiment revolved around Bitcoin. The latest week of institutional shedding now equates to $232 million worth of outflows over the period.
5th Consecutive week of crypto outflows of US$32m, poor sentiment focussed on BTChttps://t.co/55HiQejp0o— James Butterfill (@jbutterfill) May 22, 2023
Looking at that five-week stretch between April 21 and May 19, the price of BTC declined roughly 4.8% to sit at $26,842. Bitcoin is priced at $27,021 at the time of writing, according to CoinGecko.
In a May 22 article, Cointelegraph market analyst Yashu Gola suggested that the price of BTC has been stuck over the past few weeks as traders sit on the fence and wait for the next “potential market trigger that could decisively push BTC price” in either a bullish or bearish direction.
Gola pointed to the Federal Reserve’s next decision on interest rate hikes, which will occur in June, as a key example of such.
Institutional BTC shedding
Butterfill noted that Bitcoin investment products have seen $112 million worth of outflows so far this year, with 90% of the sum coming in May alone, while short-Bitcoin products have seen $34.8 million worth of outflows over May.
Butterfill, however, noted that it is “unclear why there is such coordinated negative sentiment for both long and short investment products.”
Related: CoinShares posts highest quarterly earnings since Q1 2022
Meanwhile, the most recent week saw BTC product outflows of $33 million, partially offset by $1.6 million worth of inflows to multi-asset products, $300,000 to Litecoin (LTC) products and $200,000 to XRP (XRP) products.
The second largest amount of outflows for the week was also for short-Bitcoin funds, with investors reducing exposure by $1.3 million. Ether (ETH) related products also followed closely behind with $1 million worth of outflows.
Looking at the outflows by exchange country, Germany led the outflows with $24.1 million for the week. This was followed by U.S. exchanges with $5 million.
Notably, this is despite the Economic and Financial Affairs Council of the European Union unanimously voting through the progressive Markets in Crypto-Assets (MiCA) regulation on May 16, which in theory, should be bullish for the European crypto market.
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