Crypto funds recovered, but whales are back to exchange with DailyCoin

Digital asset investment products see little inflow after subsequent 3-week pullback, reports crypto market researcher CoinShares.

According to the bi-weekly market report, aggregate capital inflows into up to 10 major digital asset funds reached $9.2 million over the past week. The numbers looked different a week ago when $27 million was withdrawn from crypto investment funds. Since the beginning of August, a total of $52.7 million has left digital asset funds.

According to CoinShares, weekly trading volumes were around $915 million, or $14 million more than a week before, when they hit the lowest levels since October 2020. CoinShares linked it to the seasonality effect and to continued apathy following the recent declines in financial markets.

The largest amounts of capital were infused into Purpose Investments’ digital asset fund ($6.5 million) and CI Investments’ crypto fund ($5.6 million). Meanwhile, crypto fund 3iQ, which belongs to Canada’s largest digital asset investment fund manager, witnessed the largest outflows of $9.4 million in the past week.

Short hosted the show

Reportedly, the largest amounts of capital were moved into the Short Bitcoin product, totaling $17.9 million over the stated time period. Multi-asset investment products witnessed the second largest capital inflow, at $3.3 million, more than 5 times lower than products offering Bitcoin shorting investments.

Meanwhile, Bitcoin and mutual funds recorded the most significant weekly losses, with $11.1 million and $2.1 million of investments fleeing the funds, respectively.

The move represented the fourth consecutive week of withdrawals from BTC investment products, resulting in nearly $70 million in capital loss over time.

Investment products related to other digital assets such as (LTC), (SOL), Tron (TRX), (ADA) and (XRP) have not reported any significant outflows, although the amounts of capital invested remained small and stayed below $1 million.

Canada’s most active US investors are pulling out

Despite the low trading volumes, the money supply showed mixed sentiments across investors in different regions.

According to the report, the largest amount of capital, or $4.7 million alone, came from Canada, followed by Brazil’s $3.2 million. Investors from Switzerland and Germany were next in line, with 1.7 million and 1.6 million dollars respectively.

Meanwhile, US investors remained mostly cautious. Their capital inflows totaled $0.8 million, “masked by predominantly inflows into short-Bitcoin investment products”, CoinShares said.

Whales continue to make deposits on exchanges

At the same time, whale deposit amounts on crypto exchanges continue to grow, says another cryptocurrency data research firm CryptoQuant.

According to them, the Exchange Whale Ratio surged just before Bitcoin’s fall today, as the dominant crypto fell below its symbolic $19K level and fell to the lowest levels not seen since June.

Whales Deposit on Exchanges Just before #Bitcoin’s 5% drop, the Exchange Whale Ratio increased. The strong increase indicates that whales are active on deposits to stock exchanges. The ratio is still high which is worrying but also typical bear market behavior pic.twitter.com/z3maytuPhz

— Maartunn (@JA_Maartun) September 6, 2022

The Exchange Whale Ratio is the relative indicator that shows the size of the 10 largest Bitcoin transactions compared to the total transactions made. According to CryptoQuant, today it once again surged to the critical 90% zone, which is historically considered a warning sign for specific crypto.

Simply put, the high value of the ratio means that whale transactions make up a large portion of all BTC deposits. Generally, the increasing inflow to the stock exchanges can be considered as a bearish signal.

On the other side

• More than half of Bitcoin’s circulating supply remained dormant throughout the past year. The share of dormant Bitcoins also continues to grow. The move is usually considered a bearish sign.

Why you should care

Bitcoin remains the dominant crypto, setting the direction where the entire cryptocurrency market will move in the short term. Bearish BTC usually means that similar sentiments may continue to linger around altcoins as well, especially in times of extremely uncertain macroeconomic conditions.

Find out more about today’s Bitcoin (BTC) price drop:

Bitcoin (BTC) falls to its lowest point in two months, falling below $19K

Check out for tips on how to survive crypto winter:

How to Get Through the Crypto Bear Market

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