Stock markets have experienced severe turmoil over the past two weeks. The biggest blow to the tech sector was the collapse of three U.S. banks supporting the digital economy.
Bitcoin was one of the hardest hit by the Silvergate Bank crisis.
A report by ByteTree Asset Management said the amount of BTC held in exchange-traded ETF funds fell to its lowest level since October 2021.
The team analyzed the performance of U.S., Canadian and European funds and found that cryptocurrency holdings fell by 16,560 BTC ($409 million) to 826,113 BTC. Such instruments are used by institutional investors to generate income without having to purchase the asset directly.
The decline in cryptocurrency ETFs indicates a sharp waning of interest among large investors in the digital currency, which has come under a lot of pressure lately.
As Charlie Morris, head of ByteTree’s investment arm, noted, institutionalists doubt bitcoin will be able to perform well in the medium term.
A similar environment is emerging in the precious metals market. Researchers have recorded capital exits from funds investing in gold.