By Richard Hines
Over 70% of the market’s total asset inflow over the previous seven days was made up of short positions in the cryptocurrency market. Coinshares and a trading group both displayed this analysis.
Short-Term Investment Products
It was discovered that investors had divided and moved their money, investing it in short-term investment products. However, this market pattern indicated a market decline during the FTX crisis and bankruptcy.
According to Coinshares report, which was used to make this determination, short investment product bets in the cryptocurrency space accounted for 75% of the market flow over the past week.
Over $13 million worth of Bitcoin entered the market, but the total inflow and outflow resulted in a negative decline of $4 million due to the popularity of short-term investment vehicles.
Inflows recorded on short investment products in the case of Ethereum surged to a record high of $14 million dollars. There were only a few minimal recorded outflows from the Ethereum exchange because Ethereum’s short-term investment product was profitable and saw mainly inflows.
The recent FTX crisis and the chain of events that followed it rocked the cryptocurrency industry and made investors nervous about the security of their money in exchanges.
The Total Assets Under Management (AUM) held by corporations on behalf of holders and investors, which represents the total market value of investments, experienced a loss of over $20 billion; this is the lowest level recorded in the past two years.
Crypto Winter Doesn’t Seem To Be Wearing Off
However, since the crash, the price of Bitcoin has fallen to new lows; as of November 2021, the coin was trading at $69,000 but now struggles to hold onto the $15,000 mark. Additionally, trading volumes and activity have decreased as investors appear to be taking very cautious measures during these volatile market times.
Recently, there was also a massive dump of 7000 BTC that was documented. This dump was traced to Bitcoin miners who were severely affected by the crash and dumped tokens into the market in order to take profit.
Other sectors and industries were severely impacted, including exchanges, tokens, crypto organizations, and investors.