Investors in the cryptocurrency market have taken advantage of the recent price drop to invest in blockchain token-based funds. A report from CoinShares reveals that there was a total of $441 million in net inflows into digital asset investment vehicles last week, following a market downturn and subsequent recovery. American investors in particular capitalized on the lower prices, with around $384 million invested in digital asset investment products on Wall Street. Other regions such as Hong Kong, Switzerland, and Canada also saw modest increases in capital inflows. Bitcoin accounted for 90% of all inflows, but investors also diversified their investments into alternative coins.
Last week, the cryptocurrency industry experienced a decline in sentiment as the overall market lost over 9% of its value, falling to $2 trillion. The market leaders Bitcoin (BTC) and Ethereum (ETH) also dropped to two-month lows. BTC fell below $54,000 due to concerns over Mt. Gox and sell pressure from Germany, but managed to rebound above $58,000. Meanwhile, ETH slipped below $3,000. The altcoin market cap saw a dip of up to 15%, with altcoins experiencing a general decline of up to 80% since Bitcoin’s halving.
Although there was a 4% bounce on Monday as traders sought opportunities for larger gains, the overall market sentiment remained bearish and cryptocurrencies recorded further losses. The “fear & greed” index for the crypto market is currently at 28, its lowest level since September last year. While the total digital asset market cap initially rose by nearly 3%, it fell again due to volatility and concerns surrounding Bitcoin. In contrast to the digital asset market, blockchain equities continued to decline. Shares from mining entities and other web3 companies have seen $556 million in outflows since the beginning of the year.
According to analysts, Mt. Gox continues to be a challenge for Bitcoin, causing uncertainty and negatively impacting its reputation.