Coinshares, a crypto exchange that offers strategies for digital asset investment, has in the past week seen an all time high outflow of funds in both Ethereum and Bitcoin. According to a report released by Coinshares today, investors pulled out $250 million in crypto funds from the exchange. Coinshares has been doing well since the start of the year but this event has reduced assets under its management by 10% to a net value of around $26 billion. The cashed out funds account for only 1% of the firms total assets invested in crypto funds as per the report from Coinshares. Coinshares has also specialized in monitoring incoming and outgoing funds from its exchange products as well as mutual funds. The company also keeps tabs on data from other trusts that monitor other digital coins like Bitcoin and Ethereum.
According to the data from Coinshares, Bitcoin funds took the greatest hit with a staggering $244 million leaving crypto funds affiliated to Bitcoin. The same data shows that Ethereum funds had an outflow of $11 million during the same duration. Other digital coins however, had $1 million being cashed out of their crypto funds. The lesser figure could be attributed to their limited adoption in the crypto community and they include Tron, Altcoin and Litecoin. The report also indicates that Coinshares managed to attract inflows in other digital coins over the same period. The coins that brought in cash flow to their crypto funds include XRP, Polygon and Solana. In total, the incoming cash flow came to around $3 million. Coinshares however, noted that, as a percentage of its total assets, this was not the highest figure it has ever experienced flow out of their funds. In May of 2019, the firm experienced an outflow of 2% of its total assets as compared to the current 1%. However, since 2019, the value of assets under Coinshare’s management has risen by at least 819% according to the report.
Following this event, Coinshares has highlighted some reasons for this outflow of cash. The past week has been harsh on the banking sector with notable institutions that were crypto-friendly shutting down due to bankruptcy or lack of enough liquidation. This includes the Silvergate bank that entered liquidation and the total crash of the Silicon Valley Bank that is currently being taken over by other banking giants. The unfortunate turn over of events shocked investors who in a panic rushed to cash out their assets to cushion themselves from the fallout. The financial crisis has caught a lot of victims in its wake with the most recent one being The Signature Bank, another crypto-friendly bank that was shut down yesterday by New York State regulators.
