Institutions Selling Ethereum as Outflows Reach $108 Million This Year
Institutions have been selling Ethereum in 2023, with outflows totaling $108 million so far, according to analysis by CoinShares. This makes Ethereum the most sold digital asset by large entities, surpassing Tron by over $50 million. However, the launch of the first Ethereum exchange-traded fund (ETF) in the United States by Cathie Wood’s Ark Invest could change the situation. Ethereum has been affected by the general sentiment towards digital assets this year, with CoinShares reporting four consecutive weeks of selling. The main reason behind the sell-off is the strength of the US dollar, but this could change if high-interest rates come into play. Trading volumes for Ethereum have also dropped significantly, indicating an apathetic investor base.
Bitcoin Halvings and Short Products Inflows
Bitcoin has also seen significant selling by large entities, with $69 million worth of the asset being offloaded. Short products for Bitcoin experienced the highest weekly inflows since March, possibly due to regulatory uncertainties. Analysts believe that investor sentiment for Bitcoin will be influenced by the Federal Reserve’s decision on interest rates. Weakness in the US dollar could be supportive for Bitcoin. However, concerns about the Consumer Price Index (CPI) coming in above expectations and potential overhangs from FTX asset sales could affect the market.
Hot Take: Ethereum Faces Institutional Selling Pressure Amidst Bear Market
Institutions have been divesting from Ethereum throughout 2023, making it the least loved digital asset for exchange-traded product investors. This trend is part of a broader sentiment of institutions selling off digital assets, as shown by the four consecutive weeks of outflows reported by CoinShares. The strength of the US dollar has been a key factor behind the selling, but analysts believe that this could change if high-interest rates become a reality. The launch of the first Ethereum ETF in the United States by Ark Invest is seen as a potential turning point for Ethereum. However, the market remains uncertain, with low trading volumes and the possibility of CPI coming in above expectations.
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