As the China scare spread, institutional investors pounced.
Institutional investors had been buying from the latest FUD of China using digital investment products that generated inflows worth $95 million. Thanks to the surge in the dip, there were inflows for the institutional cryptocurrency investment products for six consecutive weeks. Between 20th September and last Friday, the inflows worth $95 million accounted for a 126% inflows increase in a week. Ether (ETH) and Bitcoin (BTC) investment products were leading the pack with inflows worth $20.8 million and $50.2 respectively.
Out of the last 17 weeks, BTC investment products have seen outflows in 13 of them. However, as the inflows got recorded in the last three weeks, the positive sentiment towards the asset has increased. Week-over-week, the inflows to Bitcoin products increased by 234%.
The People’s Bank of China announced last week that they would be banning all cryptocurrency transactions. This triggered an 8% drop in Bitcoin’s price, which was followed by a pullback in the cryptocurrency market. According to the updated measures, all the payment firms and financial institutions have been barred from offering any crypto-related services.
Even though the FUD that came from Chinese regulators had an impact on the crypto markets before, it has acted as one of the major catalysts for the surging prices as well in the following months. For instance, the government of China banned cryptocurrency exchanges from offering services in September 2019. This was followed by the climb made by BTC from $4000 to $20,000.
Even after the ban, the appetite for altcoins has remained strong.