The Bitcoin price briefly fell below $16,000 last week as Sam Bankman-Fried’s FTX Group filed for bankruptcy.
Inflows into cryptocurrency investment products rose sharply last week as institutional investors bought the dip amid the marketwide collapse triggered by FTX’s and Alameda Research’s bankruptcies.
Digital asset investment products saw inflows totaling $42 million in the week ending Nov. 13, the largest increase in 14 weeks, according to CoinShares data. Bitcoin (BTC) investment products saw the largest inflows at $19 million, followed by multiasset and Ether (ETH) funds at $8.6 million and $5.9 million, respectively.
Investors were also betting on a further deterioration in market conditions, with short Bitcoin products registering $4.8 million in weekly inflows.
Net inflows were recorded across all major regions, led by the United States ($29 million), Brazil ($8 million) and Canada ($4.3 million).
Although investors were buying into crypto investment products, their outlook on blockchain equities soured. CoinShares data revealed that blockchain equities registered $32 million in weekly outflows, the largest since May. Meanwhile, the broader equity market recorded its best week of gains since March, with the technology-heavy Nasdaq Composite gaining 8.1% on weaker-than-expected inflation numbers.
Related: Crypto Biz: Crypto’s day of reckoning has arrived
The cryptocurrency market faced renewed sell-side pressure last week as Sam Bankman-Fried’s FTX exchange filed for bankruptcy following a run on its assets. The bank run was triggered by Binance’s sudden liquidation of FTX Token (FTX) on Nov. 6. Binance CEO Changpeng Zhao expressed interest in buying out the collapsing derivatives exchange but backed out less than 24 hours later due to an apparent hole in FTX’s finances. It has since come to light that FTX is sitting on roughly $8 billion in liabilities.
Full disclosure: Binance never shorted FTT. We still have a bag of as we stopped selling FTT after SBF called me. Very expensive call. https://t.co/3A6wyFPGlm
— CZ Binance (@cz_binance) November 14, 2022
Crypto prices appear to have stabilized following last week’s rout, with Bitcoin currently hovering just north of $16,500, according to Cointelegraph’s BTC price index. Market sentiment, however, could take months or even longer to recover.
