Institutional investors have now offloaded a total of $101.5 million worth of digital asset products last week, which looks to be in anticipation of hawkish monetary policy from the U.S. Federal Reserve according to CoinShares.
The reasoning behind this is due to the U.S. inflation rates, which hit 8.6% year-on-year at the end of May, marking a return to levels not seen since 1981. As a result, the market is anticipating that the Feds will take considerable action to control inflation, with some traders pricing in three more 0.5% rate hikes by October and others also expecting a 0.75% hike.
According to the latest edition of CoinShares’ weekly Digital Asset Fund Flows report, the outflows between June 6 and June 10 were primarily led by investors from the Americas at $98 million, while Europe accounted for just $2 million.
Notably, it appears that the institutional investors offloaded their BTC and ETH products before most of the latest price carnage happened to both assets. According to data from CoinGecko, between June 6 and June 10, the price of BTC and ETH dropped 4.7% and 5.9% each. However, since June 11, BTC and ETH have plunged around 25.7% and 33.2% respectively.
Apart from BTC and ETH outflows, multi-asset funds saw outflows of $4.7 million, and Short Bitcoin products posted minimal outflows of $200,000. At the same time, the report noted that investors also “steered clear of adding to altcoin positions.”