It seems that the rich of the world are currently benefiting from the relatively low prices on the crypto market. If we use the CoinShares Digital Asset Fund Flows report may be believed, institutional investors are currently jumping in en masse. Which is striking, because the prices are actually moving down at the moment.
The smart money
These are the parties who, in principle, do not look at price movements in the short term and mainly buy assets that they believe in in the long term. Now the bitcoin price has dropped considerably due to the emotion surrounding the FTX scandal and they see their chance to invest.
Last week, institutional crypto investment products saw their biggest inflow in 14 weeks. In total, it was ‘only’ 42 million dollars. Which once again indicates that institutional parties are still not major buyers in the market at the moment.
“The inflows started later in the week after the collapse of FTX and Alameda sent prices down. That suggests these investors saw the price declines as an opportunity to get in,” CoinShares said.
It is only a limited number of funds that have crypto on the radar and actually do something with it. The majority are probably just trying small bits and may be waiting for clearer legislation before they fully commit.
Bitcoin popular
Bitcoin products in particular are currently popular among institutional investors. These recorded an inflow of $18.8 million for the past week, while ethereum products are in second place with an inflow of $2.5 million. Incidentally, products that bet against the bitcoin rate are also doing well, with an inflow of USD 12.6 million.
These are products with which institutional investors basically go ‘short’ on the bitcoin price. If the bitcoin price drops, they win. In that respect, the high interest in such bitcoin products is a less good sign.
Other products, investing in altcoins, saw an inflow of $8.4 million across the board. Institutional investors seem to be slowly warming up to this as well.