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NEW YORK (Reuters) – Investment products and Bitcoin funds recorded cash outflows for the fifth week in a row, as investor sentiment remained cautious amid heightened global regulatory scrutiny, data showed on Monday from digital asset manager CoinShares.
FILE PHOTO: A representation of the Bitcoin cryptocurrency can be seen in this illustration taken August 6, 2021. REUTERS / Dado Ruvic / Illustration
The world’s most popular cryptocurrency releases totaled $ 33 million in the week ended August 6, up from $ 19.7 million the week before. But so far this year, bitcoin inflows have remained strong at $ 4.2 billion.
Total crypto outflows, meanwhile, amounted to nearly $ 26 million, although CoinShares noted that the scale of the outflows was much smaller than in May and June.
The sluggishness of the crypto market was due in part to the global regulatory crackdown, analysts said.
There is all this emphasis on crypto because with all the new financial products and innovative solutions, governments, who are there to protect investors, are going to wonder if it is a good idea and therefore, they are going to take an interest in it. more, said Matthijs de Vries, chief technology officer at infrastructure provider AllianceBlock.
Bitcoin hit an 11-week high above $ 46,000 on Monday. Since mid-July, bitcoin has gained 46% against the dollar.
The data also showed that ether, the token used in the Ethereum blockchain, also saw outflows of $ 2.8 million, up from nearly $ 9 million the week before.
Last Thursday, Ethereum, the second largest blockchain network, underwent a major software upgrade, which is expected to stabilize transaction fees and reduce the supply of the ether token.
The supply of ethers is reduced by burning, in which tokens are sent to specialized addresses that have unobtainable private keys. Without access to a private key, no one can use the tokens, putting them outside the circulation supply.
About $ 59.2 million worth of ether tokens have been burnt since Thursday’s software upgrade, according to Ultrasonics.money, a website that tracks burning and supply of ether.
Investors expect the Ether to accelerate gains as the Ethereum network burns more of its tokens. Ether was up 4.9% for the last time to $ 3,161.93.
Reporting by Gertrude Chavez-Dreyfuss; Editing by Marguerita Choy
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