On March 6, the European cryptocurrency investment company CoinShares published its “Digital Asset Fund Flow Report,” which revealed that Investors continued to show negative sentiment towards crypto investment products, with a total outflow of $17 million.
Negative sentiment was mainly focused on Bitcoin (BTC), with outflows for the cryptocurrency totaling $20 million. In contrast, the short-Bitcoin product saw inflows for the third week totaling $1.8 million, according to CoinShares data.
CoinShares data shows that “the overall volume in investment products was low at US $ 844m for the week,” with the Bitcoin market volume 15% lower than usual, an average of $ 57 billion. In addition, there seems to have been a change in regional sentiment, with the US experiencing an inflow of $7.6 million while Europe experienced an outflow of $23 million.
Small inflows were also observed in other crypto assets, with Ether (ETH) and Solana (SOL) seeing drawdowns of $700,000 and 340,000, respectively. In contrast, blockchain equity investors remain bullish, with inflows of $1.6 million last week. CoinShares suggests that investors are still interested in the underlying technology of digital assets but are wary of the regulatory environment surrounding cryptocurrencies.
According to CoinShares, there was an increase in total assets under management (AUM) of short-Bitcoin products for the week. However, despite recent inflows, short-BTC products have seen only 4.2% year-to-date growth in AUM compared to a 36% increase in long-bitcoin AUM. The data shows that short Bitcoin positions have failed to produce the desired results this year.
Related: BTC price ‘in the chop zone’ – 5 things to know in Bitcoin this week
Overall, negative sentiment towards crypto investment products will continue until there is more clarity on regulation. As governments around the world continue to work out how to manage this new asset class, investors should be cautious and wait until we get more information.