Bitcoin Funds Take a Hit As Investor Confidence Wanes

Money is being pulled out of big crypto funds as investor sentiment seemingly shifts and the digital asset market as a whole dips. 

Last week, investors withdrew over $54 million from large digital asset funds for the fourth consecutive week, digital assets firm CoinShares said in a Monday report. The cash flowed out from large funds designed for accredited investors like Grayscale, 3iQ, and 21 Shares.

This comes as the price of Bitcoin takes a hit: the price of the biggest digital asset by market cap was trading for $27,487 at the time of writing, down nearly 10% in the past 30 days, according to CoinGecko. 

After soaring past $30,000 for the first time in 10 months in April, the asset has struggled to stay at such highs. It is still up significantly from the start of the year, however, when it was trading for $16,615. Its market cap currently stands at $531 billion, way down from the $1 trillion it passed back in November 2021. 

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But investors aren’t feeling too bullish right now, according to CoinShares: those who pulled out cash last week were mainly focused on Bitcoin, with the biggest cryptocurrency representing 80% of all crypto outflows over the period—a total of $38 million. 

Some cash was pumped into altcoins, the firm added. “Inflows were seen across eight different altcoin assets, suggesting investors are becoming more adventurous,” Monday’s report noted. The altcoins included Cardano, Tron, and Sandbox. 

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Goldman Sachs separately said in a report this month that wealthy investors were losing interest in cryptocurrencies. 

But Bloomberg reported Sunday that as the risk of a debt default in the States is greater than ever before, a survey of investors shows that Bitcoin is favored more as a safe haven asset than U.S. dollar, the yen or the Swiss franc.