Crypto Flows Show Institutions are Still Buying

Sellers were in control of crypto markets last week, but recent price weakness was taken as a buying opportunity by many institutional investors.

What’s the Scoop?

• Buying Panic: Despite dips in crypto prices many have attributed to sell pressure from Mt. Gox and the German Government, data released from CoinShares shows digital asset investment products saw $441M in inflows last week.
• Seeking Risk: Bitcoin may have enjoyed the lion’s share of total crypto product inflows ($398M), but a 90% allocation to BTC is unusually low. Investors seemingly chose to diversify into altcoins last week, with Solana products experiencing 28% of year-to-date inflows last week.

Bankless Take:

Crypto prices have been moving lower since June, but investors decided to accumulate on last week’s dip, motivated by beliefs that multi-billion dollar asset forfeiture sales presented a discounted buying opportunity.

While there is always a risk these flows reverse, increasing breadth and risk-on sentiment demonstrated through the unusually low allocation to BTC combined with a stock market that continues to establish new all-time highs suggests crypto prices may rally in the near term.