In the world of digital assets, Bitcoin has been the center of attention in recent weeks as investors sold off a total of US$38m worth of the cryptocurrency, according to a report from CoinShares.
The outflows represent 80% of all outflows over the period and, combined with short-bitcoin outflows, highlight that the recent investor activity has almost solely been focused on the asset.
But while Bitcoin has been experiencing a series of outflows, other digital assets are seeing a surge in inflows. The report shows that investors are becoming more adventurous, with inflows seen across eight different altcoin assets.
It suggests that investors are becoming more selective and looking for new opportunities. The most notable inflows were to Cardano, Tron, and Sandbox, which all saw inflows of $0.5m, US$0.23m, and $0.2m, respectively. Binance was the only altcoin to see outflows totaling $0.5m.
However, the overall trend in digital asset investment products is still outflows. The report shows that digital asset investment products saw a fourth consecutive week of outflows totaling $54m, bringing the total outflow to $200m.
It represents 0.6% of total assets under management (AuM), and the recent price declines have seen total AuM fall by 13% since their mid-April peak.
The outflows were broad from a regional perspective, suggesting negative sentiment is not concentrated on just a few investors. That said, the outflows were primarily focused in Europe, particularly when taking into account that 84% of outflows in the US were from investors selling out of short positions.
It remains to be seen whether Bitcoin will continue to experience outflows in the coming weeks or whether investors will return to the cryptocurrency. However, the surge in inflows to altcoins suggests that investors are looking for new opportunities in the digital asset market.
Bitcoin’s Realized Cap Sees Cyclical Growth With Diminishing Returns
Meanwhile, Glassnode, a prominent analytics platform, recently shared a significant observation regarding the growth of Bitcoin’s Realized Cap on Twitter. According to their tweet, the cyclical growth of Bitcoin’s Realized Cap has been steadily increasing from one cycle to the next.
In the current Epoch, there has been a notable influx of capital, amounting to an impressive $282.8 billion. To provide context, Glassnode highlighted the capital inflow figures from previous Epochs: $74 million in Epoch 1, $5.5 billion in Epoch 2, and $102.3 billion in Epoch 3.
Despite these impressive numbers, Glassnode pointed out that the relative growth rates have been diminishing across the Epochs. In the present cycle, Bitcoin’s Realized Cap has expanded by 362%, which, although still significant, represents a lower growth rate compared to earlier cycles.
To illustrate this, Glassnode shared the growth percentages for each Epoch: Epoch 1 experienced a staggering 42,495% growth, Epoch 2 saw a substantial 7,580% increase, and Epoch 3 recorded a noteworthy 1,917% expansion.
Glassnode’s analysis emphasizes the continuous growth of Bitcoin’s Realized Cap but also draws attention to the decreasing growth rates observed in recent cycles. However, these insights provide valuable information for investors and analysts tracking the development of the cryptocurrency market.
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