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Institutions are “disappointed” by the SEC’s lack of decision-making regarding an ETF, according to the most recent report from CoinShares, prompting a widespread sell-off by large entities totalling an impressive $55 million worth of digital asset outflows in the past seven days.
Butterfill explained to Decrypt that this sudden downturn appears to be caused by an “overhyped market” that realized a Bitcoin ETF isn’t as imminent as it once seemed. He added that “fears of a Chinese-based economic downturn” haven’t helped.
According to the analyst, the summer doldrums are in full effect, with low trading volume plaguing the market. With $2.3 billion in daily volume versus $11 billion at the beginning of the year, these numbers have left the market “more vulnerable to larger trades,” said Butterfill.
Canada and Germany marked the week for solid selling by institutions in their territories, with $35 million and $11 million respectively. The sole exception was the land of the Red Cross, Switzerland, clocking $3.5 million worth of inflows.
Most altcoins suffered a drop in buying interest by institutions, with Ethereum (ETH) witnessing $9 million worth of selling. Along with the second largest crypto by market capitalization, Polygon (MATIC), Litecoin (LTC), and Polkadot (DOT) suffered outflows of under $1 million.
The numbers provided by CoinShares align with the surprise flash crash in crypto prices last week.
Digital assets saw blood in the streets after Bitcoin shed nearly 11% of its value, and dipped to prices it hadn’t seen since the beginning of June. A cascade in liquidations ensued, with over $800 million wiped from the total market capitalization.
According to Coingecko, Ethereum currently changes hands at $1,656, a 10.5% drop on the week, along with the majority of blue-chip crypto assets recording double digit losses for the past seven days.
Nevertheless, Butterfill told Decrypt he “expects volumes to rise” with the Fed’s Jackson Hole symposium and the Federal Reserve's potential decision on interest rates.
It definitely appears that Institutions are siding with the bears as the crypto market continues to hold its breath for a much-anticipated (and much-awaited) spot Bitcoin ETF, and for the markets to find something to hold onto.