CoinShares Analyst Predicts Crypto ‘Capitulation Phase’ Nearing its End

CoinShares Analyst Predicts Crypto 'Capitulation Phase' Nearing its End


Bitcoin (BTC) and Ethereum (ETH) Experience Institutional Outflows Regardless of Growing Prices

A recent report from CoinShares outlines that regardless of the growing prices of digital currencies, institutions continue to sell off their holdings. Bitcoin (BTC) has seen the most whole lot of outflows, with 85% of all institutional activity accounting for $45 Million worth of sales. On the other hand, Ethereum (ETH) has likewise experienced negative streaks, with $4.8 Million in sales by large entities in the previous week and $117 Million in outflows this year.

This trend has surprised James Butterfill, head of research for CoinShares, who pointed out that regardless of Ethereum’s attractive investment fundamentals and high demand for staking yield, it remains of lesser interest to institutions.

According to Butterfill, fund flows can sometimes serve as a contrarian indicator. This is evident when it comes to Bitcoin (BTC) and Ethereum (ETH), which have both seen price increases but continue to be sold off by institutions.

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End of the Capitulation Phase?

The growing prices and substantial outflows may suggest that we are approaching the end of the capitulation phase. In the previous 7 days, large entities have offloaded $53 Million worth of cryptocurrency, totaling $455 Million over the last nine weeks. The  United States has led the way in terms of outflows, accounting for 77% ($41 million) of the total. Germany and Canada follow behind with $5.9 Million and $4.9 Million in outflows respectively.

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Along with the outflows, CoinShares likewise reported a 42% increase in trading volumes in the previous week, reaching $1 billion.

Hot Take: Institutions Remain Bearish Regardless of Cryptocurrency Price Rises

Regardless of the positive price movements in digital currencies like Bitcoin (BTC) and Ethereum (ETH), institutional investors are still selling off their holdings. Bitcoin (BTC) continues  to be the most sold digital asset, while Ethereum (ETH) remains on a negative streak. These outflows are surprising given the attractive investment fundamentals and high demand for staking yield in Ethereum (ETH). The growing prices and whole lot of outflows may indicate that we are nearing the end of the capitulation phase. Nonetheless, it remains to be seen whether institutions will regain interest in these digital currencies in the future.

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Sources: CoinShares, James Butterfill, CoinGecko

Author – Contributor at | Website

Demian Crypter emerges as a true luminary in the cosmos of crypto analysis, research, and editorial prowess. With the precision of a watchmaker, Demian navigates the intricate mechanics of digital currencies, resonating harmoniously with curious minds across the spectrum. His innate ability to decode the most complex enigmas within the crypto tapestry seamlessly intertwines with his editorial artistry, transforming complexity into an eloquent symphony of understanding.

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