Institutional Profit Booking Seen in Bitcoin as Price Hovers Around $35K

The latest report from CoinShares, a crypto fund operator, shows that a portion of institutional investors are booking profit currently in Bitcoin counter.

According to a report published by CoinShares, there has been weekly digital asset flows of $85 million dollars last week primarily due to activities related to cryptocurrency products by institutional investor.

The data confirms that “some investors are continuing to take profits after [BTC’s] strong price appreciation.”

The report cited the rallying greenback (trade-weighted) and pointed out that the USD index “is typically inversely correlated to Bitcoin prices.” That provides the reason for profit booking by some investors at the prevailing levels.

CoinShares also found out slight movement of funds out of Ethereum based investment vehicles, i.e. around $3 million moving out of the crypto markets.

In spite of the profit-taking activity, institutional activity remains robust, with $359 million moving into crypto-related investment vehicles this week. Interestingly, institutions still seem to be totally focused on Bitcoin, as Bitcoin-based investment vehicles reflected 99% of capital outflows last week.

CoinShares points out that cryptocurrency-related investment has reached its pre-Christmas stage, after the 97% decline during the three weeks that followed the holiday period. Daily transaction volumes are over 50% on a y-o-y basis.

Currently, institution-related product offerings constitute 6% of total Bitcoin trading volume, reflecting more than a 50% decline from 14 % at the beginning of this month.

In recent times, the appetite for cryptocurrencies has increased considerably, with renowned multinational companies filling their Treasury coffers with Bitcoins.

After facilitating over futures transactions worth 11 million Bitcoins last year, Chicago Mercantile Exchange announced in December that it intends to roll out cash-settled, Ethereum-based futures contracts by next month, subject to regulatory clearance.

Yesterday, Ninepoint partners submitted its final prospectus to start a Bitcoin Trust that was conditionally cleared by the Toronto Stock Exchange.