Institutional investors were among the few buyers of crypto last week as digital assets plummeted in wake of the Federal Reserve’s rate hike.
According to a report by CoinShares, digital asset products backing Bitcoin recorded a surprise inflow last week, despite a sharp capitulation in the market. But traders also appeared to shorting the world’s largest crypto.
Institutional Investors Inflow into Crypto Amid Price Drop
According to data by CoinShares, weekly crypto asset inflows between May 2-8 show investors taking advantage of price dips across the crypto market. The crypto assets saw inflows of $40 million in total.
In fact, investors showed more interest in Bitcoin as the price plunged under $35k. A total of $45 million in inflows were seen in Bitcoin. Moreover, short Bitcoin recorded the second-largest weekly inflows ever of $4 million, with the assets under management hitting a record high of $45 million.
Investors’ sentiment was negative on Ethereum, with an outflow of $12.5 million recorded last week. However, Ethereum-killer Solana recorded positive sentiment, with an inflow of $1.9 million last week.
Purpose Investments and ProShares accumulated $56.8 million and $19.3 million worth of crypto assets in the last week. Whereas, other investors such as 21Shares, 3iQ, and CoinShares XBT sold crypto assets. Thus, inflows of $66 million were recorded in North American investment products, while Europe saw outflows totaling $26 million.
“We have not seen the same spike in investment product trading activity as we typically see historically during extreme price weakness periods, and it is too early to tell if this marks the end of the 4-week run of negative sentiment.”
Crypto Market Falls 5% Despite Institutional Buying
The bloodbath in the crypto market continues as top cryptocurrencies plunged further amid negative market sentiment. Despite the institutional buying seen in the last week, the crypto market has plunged nearly 5% in the last 24 hours.
As of writing, the Bitcoin (BTC) price is trading at $32,867, nearly 5% down in the last 24 hours. And Ethereum is trading at $2394, more than 5% fall in the last 24 hours. With the crypto sentiment index hitting the lowest levels, only institutional buying and whale accumulation could rescue the crypto market.