Bitcoin’s inflows in July have offered insight into the current market trend for the crypto coin. Last month, Bitcoin recorded $474 million in inflows. Analysts predicted whether the momentum would carry over to August.
Bitcoins inflows development
From the beginning of July, Bitcoin’s inflows maintained a steady bullish trend. Then, the crypto asset recorded $85 million of inflows during the last week of July. The end of July was the fifth week of the bullish trend maintained by Bitcoin.
During the same period, the short Bitcoin saw outflows of $2.6 million as it bets on the price decline of the cryptocurrency.
For the entirety of the month, Bitcoin recorded $474 million of inflows and broke the $24,000 mark in the last week. The inflow value nearly offset the outflows that occurred in June, which was $481 million. Compared to June 2022, Bitcoin had a 19 percent increase in July, its highest record this year.
Most of the funding came from North America, with Canada leading by introducing $67 million to the total. The U.S followed by contributing $15 million. Meanwhile, Brazil and Sweden contributed minor inflows for less than $5 million.
July was considered the strongest month in 2022 for cryptocurrency. Other than Bitcoin, cryptocurrencies like Solana and Polkadot also saw inflows. Solana, an Alt-based crypto coin, recorded $1.5 million inflows. Meanwhile, Polkadot had experienced $400,000 inflows. Ethereum funds also showed $1.1 million in inflows.
A July report from CoinShares showed that multi-asset investment products generally experienced outflows. According to CoinShares, crypto investors became more specific in their portfolios as they chose assets with higher stability.
Some crypto analysts said that the trend would continue in August. There is likely to be higher trade volume along with higher inflows this month. However, other analysts argued that August would go either way, the bullish trend would either continue or start a neutral period.
Santiment, an on-chain on-chain analytics firm, explained that there is a drop in coin circulation which was shown by the trade volume.
Antoni Trenchev from Nexo also predicted that August “promises to be every bit as stomach-churning for Bitcoin”, indicating that the market d yet to show stability.
In the fourth week of July, the trading activity volume was still lower compared to 2022’s current weekly average of $2.4 billion. The week’s volume recorded $1.3 billion. However, the current bullish trend still happens despite the lower than average trade volume.
Crypto analysts said that the bullish trend in the crypto market did not only improve positive sentiments toward the market in retail traders. Institutional traders also began to consider crypto assets in their portfolios.
In the middle of June, Bitcoin saw a drop in valuation after the news of an interest rate hike by the Federal Reserve. Investors were worried that the rate hike which aimed to curb inflation had signaled the U.S’s downturn in the economy.
There was also news about the bankruptcies of hedge fund Three Allows Capital and Terra/Luna ecosystem in June which caused investors to pull out of their crypto investments. However, the July inflows had proven that the coins can recover from the situation.