The outflows last weekend were likely responsible for Bitcoin’s decline to the $17,000 mark, says CoinShares report. There was a record of $423 million in outflows from crypto assets.
James Butterfill, a crypto analyst, said the outflows were focused on Bitcoin totaling USD 453 million. He pointed out that the outflows occurred on June 17 but were reflected in last week’s figures because of trade reporting lags. But short-Bitcoin registered inflows totaling USD 15 million. This can be attributed to the launch of the first US-based short investment product last week.
The Bitcoin market, in the past week, slipped under the $20,000 level twice. Sam Bankman-Fried, the CEO at FTX, believes the Federal Reserve’s decision to aggressively increase interest rates led to the market crash. Whatever the market conditions may be, several crypto bosses expressed optimism about the results of a market downturn. Charlie Silver, the founder of Permission.io, said there are hundreds of firms that are built on hype and “not substance”. He shared that it would be good for the healthy growth of the industry to have them go away.
Silver believes bear markets are healthy as it resets valuations to reality and flushes out the bad actors. He explained many cryptos are true Ponzi schemes that pay investors only with new investor money. The project falls apart when the new money dries up.