What to know:
- Digital asset inflows slowed to $230 million last week, mainly due to market interpretation of Fed policy.
- Bitcoin led inflows at $219 million, while Ethereum saw $27.5 million in outflows, ending a three-week streak.
- Reduced miner sell pressure removes structural headwinds, but demand is needed for sustained upward momentum.
Digital asset investment products recorded $230 million in inflows last week, marking a clear slowdown compared to previous weeks, according to the CoinShares report.
While geopolitical tensions in Iran may have weighed on sentiment, the more influential factor appears to be the market’s interpretation of the US Federal Reserve’s policy stance following its recent meeting.
Intra-week figures indicate a strong start to the week with inflows of $635 million in the first two days. However, following the announcement of the Federal Open Market Committee (FOMC), inflows turned to outflows of $405 million before stabilizing at the end of the week.
Regionally, exchanges recorded net inflows across the board, with the US recording inflows of $153 million. Germany and Switzerland recorded inflows of $30.2 million and $27.5 million, respectively.
Source: CoinShares
Also Read: US Government Shutdown Nears End: Bitcoin Price Recovers After House Approval
Bitcoin and Solana Lead Asset Flows
Bitcoin was at the forefront of investments last week, with $219 million being invested. Short Bitcoin products also experienced an inflow of $6 million, indicating a mixed trend of investors’ sentiments.
Solana continued its popularity, with $17 million being invested for the seventh consecutive week, taking its seven-week inflow tally to $136 million.
In a different trend, Ethereum experienced an outflow of $27.5 million, ending its three-week inflow streak.
Source: CoinShares
Other notable inflows include Chainlink, with $4.6 million, and Hyperliquid, with $4.5 million, indicating investors’ careful selection of assets with consistent momentum or value.
Structural Support Present, Demand Required
The Bitcoin Miners’ Position Index, or MPI, stands at -1.04, one of the lowest ever recorded, according to CryptoQuant.
This significant drop indicates that miners are moving fewer coins compared to their one-year average. This suggests that there’s little selling pressure, and miners are holding out for a higher price.
Source: CryptoQuant
In the past, levels of MPI have been low when miners are under stress or when capitulation occurs. This is considered bullish for the structure; however, it does not necessarily imply that a price bottom is in.
Previously, the price levels of BTC have begun to rise when the levels of MPI move upward from low levels, rather than when they are at extreme levels.
The current market environment sees less selling from miners, which helps remove a large barrier to supply. However, low MPI alone cannot drive prices higher.
To sustain an increase in prices, demand needs to come from other sources, such as existing trading levels, ETF flows, or positioning in derivatives.
This article contains market analysis and price predictions. These are not guarantees. Crypto markets are volatile. Always DYOR. Not financial advice.
Also Read: Bitcoin Price Pauses, CME Gap and Economic Cycles Could Shape Next Big Move
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