Institutional Investors' Sentiment For Crypto Surges Following BlackRock’s Bitcoin ETF Filing

  • BlackRock’s BTC ETF is strengthening investor confidence in the market after consecutive weeks of outflows.
  • Outflows slowed down drastically from $88 million in the past week to $5 million this week after the news of the ETF.
  • In another development, Bitcoin has regained over 50% of its market dominance for the first time in two years.

If BlackRock’s ETF becomes the real deal, it could cause a new shift for the market, which has suffered regulatory hurdles and plunging values in recent weeks, observers say.

A new report from CoinShares shows that the massive outflows from the digital asset market are cooling down gradually after the BlackRock ETF filing last week. According to CoinShares, this week marks the ninth consecutive week of outflows after a good run in Q1 2023. In the past nine weeks, the withdrawals for mutual funds, exchange-traded products, and over-the-counter (OTC) trusts have surpassed $423 million.

This week has witnessed a huge turn, with investor confidence rising, as seen by reduced outflows. Investors have withdrawn $5.1 million this week against $88 million the previous week, with other indices also pointing to growing positive sentiments.

CoinShares points to the ETF filing as a major determinant of the boost in investor confidence. On Friday, inflows of $5 million were tracked across several products. James Butterfill, the Head of Research at CoinShares, noted that these inflows were not enough to offset the previous outflows, but it shows strong signs of progress.

The end of the week saw minor inflows following the news that one of the world’s largest asset managers has applied for Bitcoin ETP in the U.S., although these inflows were not enough to offset outflows seen earlier in the week.” 

Altcoins lead outflows in the United States

Since the Securities and Exchange Commission (SEC) launched its renewed offensive on digital assets, altcoins have taken the most heat. This has led to plunging values of most assets as they were alleged to be securities by the SEC.

According to the report, products tracking the price of Ethereum recorded outflows of $5 million this past week. Other assets, including Cardano (ADA) and Polygon (MATIC), also posted massive losses after being described as securities in the Coinbase lawsuit. While Ripple (XRP) gained 4.7% in the last 30 days, ADA and MATIC plummeted 17% and 29%, respectively.

US investors accounted for $3.7 million worth of deposits last week despite the crackdown. Also, Grayscale Bitcoin Trust has surged following the news of BlackRock’s filing and accounts for 85% of weekly inflows. 

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