Trading volume among institutional investors for crypto funds fell to $1 billion last week, the second-lowest all year, according to a report by crypto asset manager CoinShares.
Business activity has been weak for some time now. Volumes have hovered at just over $1 billion for each of the past three weeks. That’s a 55% drop from the average trading volume for the year, and last week’s drop to $1 billion makes it the second-worst week of trading so far this year, according to CoinShares.
The report notes that at the end of last week, Bitcoin exchange-traded products, or ETPs, saw net outflows of $15 million. This makes it the third week in a row that investors have withdrawn more money from Bitcoin funds than they have invested. The first week of August, Bitcoin products had net outflows of $9 million, and in the previous week, short Bitcoin products, which bet against the cryptocurrency, had outflows of $3 million.
As of Monday morning, BTC was trading at just over $20,000, according to CoinMarketCap, and down 7% from a week ago.
The price of Bitcoin fell below $20,000 last week, falling to $19,600.79 on Friday, following bearish remarks from Federal Reserve Chairman Jerome Powell about raise interest rates again to counter inflation. In July, the inflation rate in the United States was 8.5%, having gained a full percentage point since the start of the year and against 5.4% at the same period last year, according to the US Bureau of Labor Statistics.
According to a report last week from Glassnode. The crypto-analytics firm wrote that even though Bitcoin’s price saw a moderate rise in the past week, trading volume for trades of $1,000 or less, which Glassnode attributes to retail traders, has steadily fallen.
“This pattern adds further confirmation of the underlying weakness in this market rally,” Glassnode wrote in its report.
Institutional investor unease appears to have impacted all crypto ETPs, according to James Butterfill, head of research at CoinShares.
“It should be noted that volumes remain very low in investment products and totaled $901 million last week, the lowest since October 2020,” he wrote in The report. “Although history indicates that this is partly due to seasonal effects, we believe it also highlights the continued apathy following recent price declines.”
The only positive, although not overwhelming, was Ethereum. The second-largest cryptocurrency by market capitalization ($184 million as of Monday morning) saw net inflows totaling $3 million last week.
Last week, the Ethereum Foundation, the nonprofit that backs the Ethereum network, confirmed that the Ethereum merger would be completed between September 10 and September 20. Merger refers to a major protocol upgrade that will combine Ethereum main network with the proof-of-stake tag string.
This means that the network will move from a proof-of-work system supporting mining to a proof-of-stake system supporting staking, which involves pledging pre-existing assets to the blockchain in order to validate transactions. and secure the network. . Although many devs had planned dates, this was the first time the foundation itself had specified when the change would take place.
“The successful upgrade of all public services test networks is now complete and The Merge is planned for the Ethereum mainnet,” the foundation wrote in a blog post last week.
That said, even themelt wave” may be in decline. Ethereum price has fallen by 6.5% over the past week.
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