Crypto Market Witnessed Second Bloodiest Week of Outflows This Year
As Bitcoin hovers near the key psychological level of $40,000, the crypto market witnessed another bloody week of outflows.
CoinShares, in its latest weekly flows report, highlighted that the digital asset market lost $134 million in profit-taking for the week ending April 8.
The report also marked that this is the second-largest weekly outflow this year. The sentiments have been turning sour as the US Federal Reserve is expected to raise interest in the coming days in order to control the expectedly high inflation levels.
Alts resilient
But, what is worth noting is that Bitcoin contributed a major $132 million out of the total investment outflow. Additionally, overall Bitcoin volumes remained under the per day average and the total assets under management (AUM) were merely at $12 million, as per CoinShares. This is in contrast to the markets’ performance in the previous two weeks. In the two weeks before this, the market clocked straight days of inflows to the tune of $244 million and $180 million in the respective weeks.
However, as of today, Bitcoin has lost over 12% of its value in the past seven days on CoinGecko. Despite that, the volume figures do not suggest any significant stress amongst investors, the digital asset manager noted in its research.
Meanwhile, the “altcoins remain resilient”.
Riyad Carey, a research analyst at Kaiko told CNBC that the expectations of a rate hike have negatively impacted the markets, adding, “Globally, the continuing war in Ukraine and increasing shutdowns in China are dragging on markets.”
But interestingly, amid the larger profit-taking, Solana received inflows worth $3.7 million along with Cardano which saw fund flows of $1 million. Others like Litecoin and Polkadot also witnessed positive inflows in the week in discussion.
Negative signals
Going ahead, the signals are not looking strong either. Ahead of the release of the official CPI numbers, the 10-year Treasury yield also surpassed 2.75% for the first time after 2019. And, a rise in bond yield tends to negatively affect risk assets like Bitcoin and tech stocks.
Meanwhile, Bank of America strategists have warned that the U.S. economy could witness a “recession shock” in the coming days. With that, former BitMEX CEO and co-founder of 100x Arthur Hayes has also predicted that Bitcoin could slump to the $30,000 level amid a stock market rout.
At the time of writing, Bitcoin is maintaining a 24-hour range of $40,455 and $43,420 on CoinGecko.
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