{"id":547386,"date":"2023-02-03T17:01:00","date_gmt":"2023-02-03T14:01:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/bitcoins-big-month-did-us-institutions-prevail-over-asian-retail-traders\/"},"modified":"2023-02-03T17:01:00","modified_gmt":"2023-02-03T14:01:00","slug":"bitcoins-big-month-did-us-institutions-prevail-over-asian-retail-traders","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/bitcoins-big-month-did-us-institutions-prevail-over-asian-retail-traders\/","title":{"rendered":"# Bitcoin\u2019s big month: Did US institutions prevail over Asian retail traders?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a2d258d5af71\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a2d258d5af71\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoins-big-month-did-us-institutions-prevail-over-asian-retail-traders\/#%E2%80%9D_Bitcoins_big_month_Did_US_institutions_prevail_over_Asian_retail_traders_%E2%80%9C\" >&#8221; Bitcoin\u2019s big month: Did US institutions prevail over Asian retail traders?   &#8220;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoins-big-month-did-us-institutions-prevail-over-asian-retail-traders\/#Almost_all_gains_were_during_US_market_hours\" >Almost all gains were during U.S. market hours<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoins-big-month-did-us-institutions-prevail-over-asian-retail-traders\/#Looking_ahead\" >Looking ahead<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Bitcoins_big_month_Did_US_institutions_prevail_over_Asian_retail_traders_%E2%80%9C\"><\/span>&#8221; Bitcoin\u2019s big month: Did US institutions prevail over Asian retail traders?   &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-5a4050f8>Bitcoin experienced the second-strongest January in its history \u2014 and the best since 2013 \u2014 rising nearly 40% amid wide reports that institutional investors were back on board.<\/p>\n<p>Zhong Yang Chan, head of research at CoinGecko, told Cointelegraph that there were \u201cnet institutional inflows into digital asset funds in January 2023, particularly in the last two weeks, with Bitcoin the largest beneficiary.\u201d <\/p>\n<p>Meanwhile, a Jan. 30 CoinShares blog <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/blog.coinshares.com\/volume-116-digital-asset-fund-flows-weekly-report-254775c068f7\">noted<\/a> that the total assets under management in digital asset investment products \u2014 a good gauge of institutional participation \u2014 had risen to $28 billion, led by Bitcoin (BTC), which was up 43% from November 2022\u2019s low point in the current cycle.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2023-02\/a11651bd-ebaa-49b6-915d-09217f34295e.jpg\"><\/figure>\n<p>The reasons for this bullishness varied depending on whom one asked, ranging from macro factors like a pause in inflation growth to more technical reasons like a squeeze on BTC short sellers. Elsewhere, a research report from Matrixport noted that institutional investors are \u201cnot giving up on crypto,\u201d further suggesting that as much as 85% of Bitcoin buying in January was the result of U.S. institutional players. The cryptocurrency services provider added that many investors had used the U.S. Jan. 12 Consumer Price Index print \u201cas a confirmation signal to buy Bitcoin and other crypto assets.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Almost_all_gains_were_during_US_market_hours\"><\/span>Almost all gains were during U.S. market hours<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>But how did Matrixport come to attribute up to 85% of monthly BTC growth to U.S. institutional investors? As the Singapore-based firm <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/niRBFtbR3u\">explained<\/a> in its recent market overview: \u201cThe most astonishing statistic is that almost all of the +40% year-to-date rally in Bitcoin has h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ened during US market hours. [&#8230;] That\u2019s 85% of the Bitcoin move.\u201d Matrixport continued:<\/p>\n<blockquote><p>\u201cWe have always worked with the assumption that Asia is driven by retail investors, and the US is driven by institutional investors.\u201d<\/p><\/blockquote>\n<p>So, if Bitcoin\u2019s market price rises during U.S. market trading hours but falls during Asian trading hours, as seemed to be happening in January, can one assume that U.S. institutional investors were buying<em> <\/em>Bitcoin while Asian retail traders were selling it \u2014 a sort of yin-and-yang action? Apparently so. During U.S. trading hours, \u201cinstitutions, aka \u2018stable hands,\u2019\u201d were taking advantage of the dips, added Matrixport.<\/p>\n<p><strong><em>Recent:\u00a0State of play: Decentralized domain services reflect on industry progress<\/em><\/strong><\/p>\n<p>Is this really what drove BTC\u2019s price upward in January? \u201cIn my personal opinion, the assumption that Asian retail and U.S. institutional investors are two main drivers of net Bitcoin flows is valid,\u201d Keone Hon, co-founder and CEO at Monad Labs \u2014 which developed the Monad blockchain \u2014 told Cointelegraph. There are other market participants, of course; but when looking at flows, \u201cirregular ones\u201d have the largest impact, continued Hon: <\/p>\n<blockquote><p>\u201cIn the current market, institutional players represent a potentially new \u2014 or renewed \u2014 source of demand similar to early 2021. Meanwhile, on the retail side, Asia-centric exchanges like Binance, Bybit, Okex and Huobi represent a majority of spot volume and nearly all of the derivatives volume.\u201d<\/p><\/blockquote>\n<p>Others, though, aren\u2019t so sure. \u201cThere is no way to confirm that U.S. markets are driven by institutional investors and Asian markets are driven by retail players since we don\u2019t have data related to the identity of traders,\u201d Jacob Joseph, research analyst at CryptoCompare, told Cointelegraph. <\/p>\n<p>Granted, there is a \u201csentiment\u201d or belief that large retail interest exists in Asia, \u201cespecially in Korea, as KRW represents the fourth-largest trading pair after USDT, BUSD and USD,\u201d continued Joseph, but it can\u2019t really be quantified. <\/p>\n<p>Still, he acknowledged that the Matrixport report was interesting, adding, \u201cOur data shows that more than two-thirds of the BTC returns in January can be attributed to the U.S. market hours, and our historical hourly data also shows that an above-average volume is traded during these hours.\u201d<\/p>\n<p>Justin d\u2019Anethan, institutional sales director at the Amber Group \u2014 a Singapore-based digital asset firm \u2014 told Cointelegraph, \u201cI don\u2019t really have metrics to say whether 85% is on point or not.\u201d He was inclined to see the January rally as broad and macro-driven, especially with inflation heading lower and expectations that the U.S. Federal Reserve won\u2019t keep raising rates. He added:<\/p>\n<blockquote><p>\u201cYou can see equities, gold, real estate, and, yes, crypto gaining. That\u2019s probably driven by large institutions and smaller investors alike, especially when FOMO kicks in.\u201d<\/p><\/blockquote>\n<p>D\u2019Anethan also looked at Coinbase\u2019s recent premium index, \u201cwhich is in the green but not massively. That\u2019s typically a good metric to see if bigger American entities are on a shopping spree. Right now, it looks muted, positive, but probably just reallocating cash that was sitting on the sidelines.\u201d <\/p>\n<p>Jacob said that a better way to gauge U.S. institutional activity is to look at exchanges \u201cthat cater their services solely to them.\u201d Along these lines, \u201cCME Group, the largest institutional exchange in crypto, saw its monthly volume rise 59% in January,\u201d while LMAX Digital, another institutional-focused exchange, \u201calso saw its trading volumes rise 84.1%, higher than the average increase in trading volume on other exchanges.\u201d<\/p>\n<p>Then, too, who\u2019s to say Asian retail traders aren\u2019t operating during U.S. market hours? Chan, for instance, acknowledged that while the markets \u201cdo tend to move more during U.S. hours,\u201d CoinGecko believes that this is \u201cmore a reflection of the outsized influence that U.S. monetary policy currently has on the crypto market and broader financial markets. Traders are most active when they believe markets are volatile, and in the current environment, Asian traders may have also gravitated toward \u2018Fed watching\u2019 to catch potential market movements.\u201d <\/p>\n<p>Chris Kuiper, director of research at Fidelity Digital Assets, told Cointelegraph that there isn\u2019t a single event or catalyst that one can point to, to explain Bitcoin\u2019s recent price movement. But to him, \u201cIt\u2019s not surprising given the conditions that have been forming \u2014 namely, the increasing amount of illiquid coins, coins that haven\u2019t moved in over a year \u2014 and the continued outflow of coins from exchanges.\u201d Both factors make for a lower supply of BTC \u201cand create conditions ripe for higher moves.\u201d<\/p>\n<p>Kuiper also cited the futures and derivatives market as a factor in BTC\u2019s climb, \u201cwith a large amount of shorts getting liquidated over the past few weeks.\u201d D\u2019Anethan, too, mentioned \u201cshort-sellers getting squeezed\u201d as a possible driver. \u201cIn itself, it\u2019s not a cause for [prices] going up, but when things do rise, it accelerates it.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Looking_ahead\"><\/span>Looking ahead<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Be that as it may, if one agrees that January held some promise for Bitcoin on the institutional front, can one necessarily assume that it will persist through 2023?<\/p>\n<p>\u201cAs the market gains clarity on which players avoided contagion, we\u2019ll see an uptick in new entrants that were sidelined during the back half of last year, particularly as innovative custody agreements emerge to address the major pain points of the recent collapses,\u201d David Wells, CEO of digital asset trading platform Enclave Markets, told Cointelegraph. <\/p>\n<p><strong><em>Recent:\u00a0What crypto hodlers should keep in mind as tax season approaches<\/em><\/strong><\/p>\n<p>More needs to be done to maintain institutional momentum, the executive stated. \u201cTo really attract institutional flow, crypto markets will need to build more sophisticated products that allow for proper hedging and risk management,\u201d added Wells. He\u2019s optimistic providers will rise to the challenge, however. <\/p>\n<p>It appears that inflation may have peaked, and many expect the U.S. Fed and perhaps other central banks to slow the pace at which they tighten interest rates, said Kuiper. While that does not necessarily portend rising risk-asset prices, \u201cinstitutions and other asset allocators in the longer-term may once again turn to Bitcoin if central banks ease aggressively as they have done in the past,\u201d he concluded.<\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/bitcoin-s-big-month-did-us-institutions-prevail-over-asian-retail-traders\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Bitcoin\u2019s big month: Did US institutions prevail over Asian retail traders? &#8220; Bitcoin experienced the second-strongest January in its history \u2014 and the best since 2013 \u2014 rising nearly 40% amid wide reports that institutional investors were back on board. Zhong Yang Chan, head of research at CoinGecko, told Cointelegraph that there were \u201cnet&#8230;<\/p>\n","protected":false},"author":1,"featured_media":547387,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/s3.cointelegraph.com\/uploads\/2023-02\/d4eeda9e-84ab-497b-820d-3fcbb9611737.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,74937,74860,74355,25196,65078,71407],"class_list":["post-547386","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-price","tag-cryptocurrency-exchange","tag-adoption","tag-asia","tag-mainstream","tag-trading"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/547386","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=547386"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/547386\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/547387"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=547386"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=547386"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=547386"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}