Cryptocurrency prices have climbed somewhat after investors appeared to view Bitcoin as a safe haven for their money. In fact, even the Russians and Ukrainians have been seeking alternatives to their country’s financial institutions.
Bitcoin is a particular favourite, with current geopolitical events allowing Bitcoin (BTC) to turn into a store of value asset.
Nonetheless, institutional investors are backing the wider cryptocurrency market too, with most digital assets seeings signs of recovery.
A much needed improvement
Crypto investment products saw inflows of $127 million last week, according to a CoinShares report. New investment flows into crypto funds tripled last week to their highest level in nearly three months.
As can be observed, there have now been seven consecutive weeks of positive inflows for Bitcoin. This is a sign of institutional investors’ interest in crypto, despite the recent retail sell-off. Such positive sentiment was centered in North America, with the region seeing inflows of $151M. Europe, on the contrary, saw outflows totaling $24M.
Bitcoin was the most popular asset among institutional investors, as nearly $100 million was transferred into it.
Bitcoin saw inflows totalling $95M last week, the largest single weekly inflow since early December 2021. This marked 7 consecutive weeks of inflows for the largest cryptocurrency. Indeed a major jump from last time when BTC registered inflows of around $17 million.
This didn’t really come as a surprise given the reliance on bitcoin over the previous weeks. Global sanctions following Russia’s invasion of Ukraine, along with truckers in Canada who lost access to banking services during a protest against their government, have propelled Bitcoin away from the category of risky investments.
And the remainder?
Well, altcoins saw a mixed bag of fortunes. However, Ethereum, the world’s largest altcoin, got much-needed relief after witnessing a series of outflows. Ether funds saw minor inflows of $25 million, its highest figures in 13 weeks.
Multi-asset crypto funds saw inflows amount to $8.6 million, but individual altcoins were flat over the week. In fact, some have even seen releases. The report stated,
“Altcoin fortunes were mixed last week, with outflows from Solana (US$1.7m), Polkadot (US$0.9m) and Binance (US$0.4m). While Litecoin, Cardano, and XRP saw inflows totalling US$0.4m, US$0.9m and US$0.4m respectively.”
Overall, while this may be a good sign given the return of institutional investors, the risks are still there. All one can do is be prepared and hedge against risk.
For instance, miners have continued adding Bitcoin to their reserves. The hashrate or network’s computing power hit a high of 212,000 Ehash/s too.
The last significant exit from the miners came when the price broke its previous all-time high, trading near $25,000. Since then, however, there have been no more mass sales.
