Summary:
Bitcoin and Ether saw a 28% drop, wiping out $367 billion in value.
Spot ether ETFs gained $120 million in net inflows as investors bought during the dip.
Morgan Stanley now allows its advisors to promote Bitcoin ETFs to high-net-worth clients.
Bitcoin ETFs hold $54.30 billion in assets, while spot ether ETFs hold $7.25 billion.
The crypto market's cap has regained over $2.1 trillion, correlating closely with U.S. stocks.
The crypto markets are stabilizing as we approach the weekend following a tumultuous week that tested the resilience of institutional investors new to the crypto space. Earlier this week, a significant sell-off in Bitcoin and Ether wiped out $367 billion in value, coinciding with a downturn in Japanese markets. Surprisingly, many of these new traders were eager to buy the dip.
Spot ether exchange-traded funds (ETFs) saw net inflows of around $120 million as traders capitalized on Ether’s drop of 42% from its March peak of over $4,000. Meanwhile, although net flows for spot bitcoin ETFs were negative initially, demand surged midweek, adding more than $245 million on Wednesday and Thursday.
Morgan Stanley recently allowed its 15,000 financial advisors to promote Bitcoin ETFs to clients worth over $1.5 million, marking a significant shift in the wealth management sector's approach to crypto investments. As of now, Morgan Stanley has disclosed $270 million in Bitcoin ETFs among its $1.5 trillion assets under management. This move might pressure other asset managers to follow suit.
While spot ether ETFs have seen limited interest compared to the booming bitcoin ETFs, the latter holds a staggering $54.30 billion in assets versus $7.25 billion for ether.
Market Movements
The crypto market mirrored U.S. stock movements throughout the week, regaining hundreds of billions in market cap, now exceeding $2.1 trillion. Bitcoin reached an intraday high of nearly $63,000 and Ether traded above $2,700. Additionally, over $100 million in short bets on Bitcoin were liquidated within 24 hours, supporting its price recovery.
Despite recent gains, Bitcoin and Ether are still down over the past week, with Ether experiencing its worst week in two years. The correlation between crypto prices and U.S. stock performance remains evident, driven by macroeconomic factors, including the recent unwinding of the yen carry trade and positive jobless claims data.
Regulatory shifts are also in favor of the crypto industry, as a U.S. judge ruled favorably in a legal case involving Ripple, significantly reducing the SEC's penalty request, which caused Ripple's XRP token to surge by 22%.
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