Originally published on: August 05, 2024
Amid rising concerns about a potential recession in the US and global geopolitical uncertainties, the cryptocurrency market witnessed a significant decline last week. According to a report by CoinShares, digital asset investment products experienced outflows totaling $528 million during the week of July 28 to Aug. 3.
This marked the first time in four weeks that crypto assets saw outflows, with Bitcoin leading the pack with $400 million in outflows. The sell-off was attributed to fears of a US recession, geopolitical uncertainties, and broader market liquidations across various asset classes.
While Bitcoin and Ether both experienced significant outflows, some multi-asset crypto investment products managed to attract inflows. Short-Bitcoin products also saw an increase in inflows during the same period.
Despite the recent market turbulence, industry analysts remain divided on the future direction of prices. While some see signs of a potential bottom approaching, others caution that further downside could be in store for both Bitcoin and Ether.
The sharp market decline on Aug. 4 and Aug. 5, which saw Bitcoin dip below $50,000 for the first time since early 2024, added to the uncertainty in the market. At the time of writing, Bitcoin is trading at $51,301, down 15.6% over the past 24 hours.
With market volatility on the rise and liquidations amounting to $1.1 billion in the past 24 hours, the crypto market is facing a period of heightened uncertainty. While some anticipate a rebound in prices, others warn of potential further downside in the near term.
As investors navigate the turbulent waters of the crypto market, staying informed and prepared for all possible scenarios is crucial. CoinShares’ latest report sheds light on the recent outflows and provides valuable insights into the factors driving market sentiment in these uncertain times.