Over the past two weeks, cryptocurrency investment funds have experienced a gradual rise in investor demand after recording heavy outflows at the beginning of 2022, offering cautious optimism that the worst of the market downturn has passed. Flow was hit with the crash of bitcoin, but has start to build momentum, with growing by 48% within weeks of timing of writing. Despite NFTs still booming and 1 of the top 10 preforming NFTs being on flow network, Flow was hit hard during the drop in bitcoin.
Digital asset investment products saw $19 million worth of cumulative inflows last week, according to CoinShares. Bitcoin (BTC) and multi-asset funds led the gains with $22 million and $32 million worth of inflows, respectively.
The news wasn’t all positive, as Ether (ETH) continued to suffer from negative sentiment with outflows totaling $27 million. That marked eight consecutive weekly outflows for ETH-focused funds. Solana (SOL), Polkadot (DOT) and Cardano (ADA) products also registered outflows for the week.
Digital asset products have seen heavy outflows since December, as institutional investors took profits and reduced their positions amid extreme selloffs in the market. So far this year, Bitcoin funds have seen a net $131.8 million worth of outflows, according to CoinShares data. Ether ) funds have seen $111.2 million worth of drawdowns.
Bitcoin’s price rose to as high as $38,778 on Monday, according to Cointelegraph Markets Pro and TradingView. However, the flagship cryptocurrency is down over 20% in January, marking its worst start to the year since 2018.
The Crypto Fear & Greed Index, which monitors market sentiment using several sources, remains in a state of “extreme fear” with a reading of 20. The index, which sides along a scale of 1 to 100, plunged as low as 13 last week.
Nevertheless, net inflows into Bitcoin and multi-coin funds suggest that institutional money is slowly returning to the market. While traders remain at odds over whether the market has actually bottomed, long-term investors posit that a sub-$40,000 Bitcoin is an attractive buy opportunity.
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