Read full article at Cointelegraph.com News.
Cryptocurrency investment products lost 10% of assets under management last week as institutional investors rushed for the exit during the latest episode of market volatility prompted by the Silvergate and Silicon Valley Bank collapses.
Digital asset investment products registered $255 million in outflows for the week ending March 12, marking the fifth consecutive weekly decline and the largest seven-day drop on record, according to CoinShares. The 10% drop in assets under management, or AUM, retraced all the gains in 2023.
As the largest and most influential crypto asset, Bitcoin (BTC) witnessed a $244-million drawdown. Ether (ETH) products lost $11 million in AUM, while multi-asset funds gained $2.2 million.
Year-to-date flows are now negative for Bitcoin, Ether and multi-asset funds. Although short-Bitcoin products registered minor outflows last week, these assets have seen $49 million in total inflows this year.
Investors were on edge last week after Silvergate Bank, a crypto-friendly financial institution, announced that it would unwind its operations and liquidate all remaining assets. Earlier in the month, Silvergate announced it would delay filing the necessary paperwork with the United States Securities and Exchange Commission, prompting widespread fears about its financial position. Like other companies, Silvergate’s problems stemmed from its involvement with the now-failed FTX cryptocurrency exchange.
Related: Crypto Biz: Silvergate shutting down, Alameda suing Grayscale
@federalreserve @USTreasury @FDICgov issue statement on actions to protect the U.S. economy by strengthening public confidence in our banking system, ensuring depositors’ savings remain safe: https://t.co/YISeTdFPrO
— Federal Reserve (@federalreserve) March 12, 2023
Adding to last week’s chaos was the sudden closure of Silicon Valley Bank (SVB), a financial institution with deep ties to crypto-focused venture capital funds. Although the bank was allowed to fail, the Federal Reserve, U.S. Treasury and Federal Deposit Insurance Corporation confirmed over the weekend they would guarantee all SVB deposits.
Yes, the FDIC bailed out Bitcoin.
— Nassim Nicholas Taleb (@nntaleb) March 13, 2023
The resolution to the SVB collapse seems to have shored up confidence in the crypto sector, leading to broad market rallies for Bitcoin and other crypto assets. Bitcoin’s price reached as high as $24,639 on March 13 after falling below $20,000 last week, according to data from Cointelegraph Markets Pro.
This article is strictly for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. CryptosOnline.com does not provide investment, tax, legal, business or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any loss or damage caused or alleged to be caused by, or in connection with, the use of or reliance on any content, goods, services or opinions mentioned in this article.
#Bitcoin #Crypto #Cryptocurrency
