Institutional Bitcoin sentiment flips bullish, but fund inflows dominated by Cardano, Solana
Institutional investors with long exposure to Bitcoin have reached a record high of $165 million.
Net exposure to Bitcoin for institutions has turned positive for the first time since Q2 2021.
Despite the recent retracement, the data suggests that the leading cryptocurrency could be awaiting further upside price movements.
Data from Arcane Research suggest that institutions are now turning bullish on Bitcoin, as the leading cryptocurrency has recovered from the lows recorded in the past few months. Although the bellwether cryptocurrency is retracing from recent highs, the renewed positive sentiment from asset managers means there may be a strong conviction for further gains for BTC.
Bitcoin institutional open interest reaches all-time high
Bitcoin open interest from institutional investors on the Chicago Mercantile Exchange (CME) has been net positive throughout August, according to Arcane Research. The net exposure has been the highest long exposure at $91.6 million seen among asset managers since the beginning of this year.
Bitcoin open interest with long positions from institutions has also reached an all-time high at $165.7 million, which indicates that asset managers believe that Bitcoin price still has room to surge higher.
Looking back at the trend in 2020, institutions were also net long following the recovery from the Bitcoin crash in March when the bull market was in anticipation.
Arcane Research suggested that the Bitcoin sentiment among asset managers has flipped bullish, with short positions at $74.1 million, much lower than the peak seen in May of this year.
However, the research firm also suggested that Bitcoin price at $50,000 would be a difficult level to surpass given that the trading volume for the leading cryptocurrency is declining.
Bitcoin investment products have also seen a week of outflows, while altcoins are now representing 32% of the total crypto assets under management, according to a CoinShares report. Ethereum killer protocols, in particular Cardano and Solana, have dominated the recovery, as sentiment has improved in altcoins rather than the bellwether cryptocurrency.
Cardano witnessed inflows of $10.1 million last week, the largest ever recorded, taking its market share to 0.15%.
Solana saw inflows of $2.7 million last week, overtaking Bitcoin Cash in terms of AUM, while Polkadot witnessed $1.5 million of inflows.
Institutions Load Up On $24M Of ETH, ADA, SOL As BTC Records 8 Consecutive Weeks Of Outflows
What Happened: Market-leading altcoins amassed significant gains from institutional funds over the past seven days as Bitcoin (CRYPTO: BTC) continued to record outflows for an eighth consecutive week.
According to the latest CoinShares report examining weekly digital asset flows, Cardano (CRYPTO: ADA) reported $10.1 million in inflows this week – its largest on record.
ADA, now the third-largest cryptocurrency by market cap, has consistently seen massive inflows over the past few weeks. The token’s price has rallied by over 100% over the past month, driven by momentum surrounding its upcoming Alonzo hard fork that will bring smart contract functionality to the blockchain.
Read Also: What is Cardano?
Solana (CRYPTO: SOL) is another crypto asset that institutions have been paying attention to of late. The Proof-of-Stake (PoS) blockchain has rallied by 200% since the beginning of the month and has continued to hit fresh all-time highs.
Last week, SOL saw $7.1 million in inflows from institutions. Since the end of last week, the token’s price has already appreciated over 50%. This week, SOL saw $2.7 million in inflows, and market sentiment surrounding the coin remained high.
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Institutional sentiment towards the leading altcoin Ethereum (CRYPTO: ETH), too, appears to have picked up. ETH saw an influx of $17.2 million this week, after months of recording moderate inflows, and now represents 32% of total digital asset AUM.
Read Also: What is Solana?
However, the same can’t be said for the market-leading crypto-asset Bitcoin, which recorded $3.8 million in outflows over the week. According to CoinShares, 14 out of the last 18 weeks have seen outflows from Bitcoin.
Price Action: At press time, Bitcoin was trading at $47,601, gaining just 0.70% over the past 24-hours. Ethereum was up by 7.30% over the same period, trading at a price of $3,414. Cardano was trading at $2.78, and Solana was trading at an all-time high of $125.22.
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Altcoin funds see inflows, bitcoin logs 8th straight week of outflows
NEW DELHI : Investors continued to pour into digital funds based on altcoins, such as ether and cardano, even as bitcoin funds logged their eighth straight week of outflows last week, digital asset manager CoinShares said. Altcoins is a cumulative term to define cryptocurrencies that came after bitcoin.
The inflows followed the longest bearish streak since 2018, however, the recovery has been predominantly due to improved sentiment in altcoins rather than bitcoin this time.
Overall, crypto funds saw a second consecutive week of inflows, totalling $24 million last week. On the other hand, bitcoin saw outflows for the 8th consecutive week, with outflows totalling $3.8 million last week. The digital asset has seen outflows in 14 out of the last 16 weeks, with outflows of $650 million in total.
Cardano, which recently became the third biggest cryptocurrency, saw inflows totalling $10.1 million last week, its largest on record, bringing its market share to 0.15%.
Altcoins, including ethereum, now represent 32% of total digital assets under management (AUM), close to the record 35% set in mid-May this year and surpassing the 30% highs seen in January 2018.
Moreover, both solana and polkadot continued to see inflows of $2.7 million and $1.5 million, respectively. Solana has overtaken Bitcoin Cash’s AUM and now totals $15.7 million.
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