A recent Coinbase data showed that nearly $1.4B worth of BTC has left the crypto exchange in the last seven days. Thus, proving that more institutional investors are becoming more comfortable with the digital asset class. Within the last couple of years, most famous institutional investors have shown keen interest in the crypto sector. The latest BTC outflow from Coinbase exchange only serves to confirm this fact.
Continued Institutional Demand For BTC
Many retail investors have been scared from investing in digital assets recently following the continued victimization of the crypto market by various authorities. However, institutional investors continue to invest in the market as they focus on the long-term gains over the short-term benefits of the market.
On-chain analytics firm, Glassnode’s latest report confirms these facts. The report further stated that 31,150 BTC (valued at nearly $1.4b) left Coinbase exchange in the last seven days. This outflow represents a 5-year high of BTC outflow from any crypto exchange globally. Thus, the Glassnode report claims that this outflow is proof that institutional investors are starting to regard BTC as a viable investment alternative.
This huge outflow has caused a significant decline in the amount of BTC held by Coinbase, which is now estimated to be 660K BTC. Furthermore, Coinbase’s total BTC holdings are now 37% lower than the peak amounts recorded in march 2020. The Glassnode data also stated that this Coinbase BTC balance reflects the huge BTC outflows that occurred this past week. It further proves that many institutional investors are seriously adopting BTC as an asset as they purchase huge amounts of it from the biggest crypto exchange in America.
Institutional Acceptance Of BTC
The huge amounts of BTC that flowed out of Coinbase coincided with a rise in the illiquid supply shock ratio during the last seven days. The rise of this ratio proves that bought coins are being moved into crypto wallets with almost zero selling histories. The digital asset market has experienced huge volatility since the beginning of the year, with BTC’s price dipping from a November 2021 peak of $69k to the $34.5k range as of this writing.
Hence, it is no wonder that the fear, uncertainty, and doubt index has also risen during this period. While retail investors panic, institutional investors keep buying huge amounts of BTC as they now come to terms with the fact that cryptos are now a major part of the world’s financial infrastructure, and that won’t change anytime soon. The crypto market will continue to grow and mature with or without institutional investors.
However, as more institutional investors invest, it will bolster the adoption of the crypto market. Top trading houses and hedge funds were the first to recognize BTC as an asset class when they started investing in it two years, especially during the heat of the COVID-19 pandemic. Also, popular institutional firms such as Tesla, PayPal, and Block began their BTC investment journey in the same year.