The cryptocurrency market appears to be calming down heading into the weekend after a volatile week that tested how institutional investors new to crypto trading react to the huge swings that are commonplace for experienced digital currency investors.
The sell-off in Bitcoin and Ethereum began earlier this week, wiping out $367 billion in value just as the Japanese market plunged, but as it turns out, these novice crypto traders were buying in at the lows.
Spot Ether Exchange Traded Fund Net inflows were approximately $120 million Most traders bought on Monday and Tuesday this week after the world’s second-largest cryptocurrency fell 42% from its March high of $4,000.
The net inflow was Spot Bitcoin ETF After being in the negative since Monday, demand began to accelerate again mid-week, with spot funds adding more than $245 million on Wednesday and Thursday, according to data from crypto analytics firm CoinGlass.
Bitcoin and Ethereum, 1 month
Hundreds of millions of dollars began pouring into the bitcoin ETF spot on the same day that Morgan Stanley gave permission to its 15,000 financial advisors to start pitching it to clients with net worths of more than $1.5 million. Black Rock And Fidelity.
This bank is one of the world’s leading maximum The wealth management firm is the first of Wall Street’s major firms to take this step. Until now, wealth management firms have only facilitated transactions if their clients specifically requested exposure to these new spot crypto funds.
Morgan Stanley $1.5 Trillion in Assets Under ManagementThe bank disclosed that it holds about $270 million in physical bitcoin ETFs in a filing on May 13. The next filing deadline on Wednesday is expected to provide an update on how much exposure banks and hedge funds currently have to these physical cryptocurrency products.
It is expected that other brokerages and asset managers that have so far been on the sidelines conducting in-house due diligence on spot cryptocurrency ETFs may also feel pressure to follow Morgan Stanley’s example.
The Spot Ethereum ETF, which launched less than three weeks ago, is relatively illiquid compared to the Spot Bitcoin ETF that launched to much fanfare in January. The Bitcoin fund has total assets under management of $54.3 billion, while the Spot Ethereum funds as a whole have $7.25 billion in assets under management.
In step with US stocks
The cryptocurrency market has traded in line with U.S. stocks for much of this week.
The total market capitalization of all tokens has recovered hundreds of billions of dollars since Monday and now stands at over $2.1 trillion.
Bitcoin hit an intraday high of nearly $63,000 on Friday, while Ether was trading above $2,700 earlier.
More $100 Million Short Selling Bets on Bitcoin The liquidations occurred within the past 24 hours, helping to bolster Bitcoin’s price.
While Bitcoin and Ether are well up from Monday’s intraday lows, both assets are still down over the past seven days, with Ether on track for its worst week in two years.
A similar situation is occurring with some cryptocurrency-related stocks. Coinbase, MicroStrategy Bitcoin Miner Riot Platform Stock prices have fallen for three consecutive weeks.
This week’s cryptocurrency price action has highlighted how closely digital assets continue to track U.S. stocks, and how they tend to react to the same macro triggers.
The unwinding of the yen carry trade contributed to turmoil that rocked global markets earlier this week, before the latest data on jobless claims came in below expectations on Thursday, helping to ease recession fears. The S&P 500 hit a nearly two-year high on Thursday, and the cryptocurrency market rebounded sharply.
It also helps that regulatory winds are beginning to shift.
However, another US judge has sided with the cryptocurrency industry in its legal battle with the US Securities and Exchange Commission.
U.S. District Judge Analisa Torres ordered Ripple to pay a civil penalty of $125 million, significantly less than the $2 billion the SEC had sought. Following the news, Ripple’s XRP token soared 22% on Thursday.
