Funds betting on bitcoin fall dominate inflows into crypto investment

abdelaziz Fathi

Investment products that involve shorting Bitcoin dominated inflows over the past week, representing 75% of total inflows. The figure amounted overall to $18.4 million, suggesting deeply negative sentiment, likely being a direct result of the ongoing fallout from the FTX collapse.

Bitcoin in a few hands

According to the latest CoinShares report, total assets under management (AuM) have now shrunk to $22 billion, the lowest in two years, having started the year at $64 billion.

Despite additions to short bitcoin products, Bitcoin-based products saw inflows totaled $14 million. But when offset by the inflows into short investment products, the net flows were a negative $4.3 million. AuM on short-Bitcoin is now at $173 million, close to the record high of $186 million.

Breaking down the latest statistics, Coinshares said the aggregate data masks a significant regional polarization of views. In particular, inflows into short investment products were seen in both the US and Europe although some short products saw outflows implying opinion is divided amongst investors as to whether the market has reached its lows.

Apart from Bitcoin, Ethereum-based crypto investment products saw minor outflows totaling $0.8 million although it also saw the largest inflows on record into short-Ethereum investment products of $14 million. This negative sentiment is likely a result of renewed uncertainty over the Shanghai update, which will allow the withdrawal of staking assets, and the hacked FTX ETH assets which sum to ~$280 million.

Meanwhile, a raft of outflows was seen across altcoins, most notably Solana, XRP, Binance and Polygon totaling $6 million.

CoinShares is Europe’s largest digital asset investment firm. Earlier this month, the company posted third-quarter earnings that showed a marked improvement when compared with the second quarter.

Combined revenue, gains and other income was reported at £20.0 million, up 41 percent from Q2 2021’s £14.2 million. However, the figure was down by 24 percent when weighed against £26.2 million in the comparable period of 2021.

The company’s net asset position has increased 20% year-to-date, to £240.6 million at the end of Q3. This compares to £200 million it reported on December 31, 2021. Coinshares reported a loss of £0.1 million in the quarter ending June 30 from a positive income of £26.6 million the previous year. That was Coinshare’s first negative quarter since going public in March 2021.

The company attributed the net loss to its TerraUSD (UST) holdings. The London-based firm recorded an “exceptional” loss of £17 million (roughly $21.4 million) from its exposure to Terra’s token when it exited its UST position.

Read this next

Retail FX

Banxso announces 8.7% interest rate on deposits in South Africa

“With Banxso, they can enjoy the benefits of both worlds – earning competitive interest and having the freedom to trade, all within the same platform.”

Industry News

FINRA to publish transaction details in U.S. Treasury securities

“Consistent with our longstanding practice, FINRA is introducing greater transparency in a calibrated and careful manner, benefiting liquidity and resilience in this critical market while also mitigating potential information leakage concerns.”

Institutional FX

OpenYield launches “cheap and easy” fixed income trading for brokers

“We’re on a mission to make bonds cheap and easy to trade, and are excited about the opportunity to build generational capital markets infrastructure.”

Digital Assets

Sumsub and Mercuryo publish a guide for VASPs: “Mastering Travel Rule Compliance”

“At Sumsub, we’ve concentrated our efforts on filling the gap in understanding the complexity of Travel Rule regulation and helping organizations find the best solution to stay safe and compliant while minimizing costs and avoiding potential risks of non-compliance. This guide we created with Mercuryo, our trusted partner, is the ultimate navigation tool all VASPs can consult.”

Digital Assets

Bitget Wallet Leads with Record Swap Volume & New Crypto Innovations

This week, Bitget Wallet achieved a milestone by surpassing Metamask with a record 388,757 Swap order transactions, securing the global lead. The significant 7-day trading volume, almost 68,000 more than its rival, underscores its liquidity and user trust. This robust activity signals Bitget Wallet’s prominent role and reliability in the dynamic crypto market.

Digital Assets

Embarking on a Digital Currency Journey

Imagine you’ve stumbled upon a treasure map, leading you to untold riches hidden in the vastness of the internet. Instead of gold coins and jewel-encrusted goblets, this treasure comes in the form of digital currencies, the modern-day loot coveted by many.

Reviews

Traders Union Experts Share The Trading Analyst Review For 2024

Navigating options trading in rapidly shifting markets poses a considerable challenge. This is where options trading alert services become invaluable. They aid traders in keeping abreast of evolving opportunities and market trends. In this assessment, Traders Union experts scrutinize The Trading Analyst alert service to ascertain its efficacy. 

Digital Assets

BlockDAG’s Presale Achieves $9.9M: Aiming For A 5000-Fold ROI As Cardano’s Price Rises And Fantom Launches Sonic

Explore Cardano’s surge, Sonic’s efficiency, and why BlockDAG’s growth makes it the top crypto choice. A deep dive into the future of blockchain investments.

Digital Assets

US, UK probe $20 billion Tether transfers tied to Russian exchange.

U.S. and UK authorities are investigating the movement of $20 billion in the USD-pegged stablecoin tether (USDT) through Moscow-based exchange Garantex.

<