Institutional investors were buying the dip on the back of China’s latest FUD, with digital asset investment products generating $95 million worth of inflows last week.
According to CoinShares’ Monday “Digital Asset Fund Flows Weekly” report, a surge in dip buying helped drive a sixth consecutive week of inflows for institutional crypto investment products broadly.
The $95 million worth of inflows between Sept. 20 and Friday marks a 126% weekly inflows increase. Bitcoin (BTC) and Ether (ETH) investment products led the pack with $50.2 million and $28.9 million worth of inflows, respectively.
While BTC investment products have seen outflows in 13 of the past 17 weeks, positive sentiment toward the asset rose during September as inflows were recorded for the past three weeks. Inflows to Bitcoin products also increased by 234% week-over-week.
Institutional appetites for altcoins appear to remain strong, with products tracking Solana (SOL), Cardano (ADA) and Polkadot’s DOT posting inflows of $3.9 million, $2.6 million and $2.4 million, respectively. Multi-asset funds also saw inflows of $6.4 million this past week.
Related: Crypto has recovered from China's FUD over a dozen times in the last 12 years
The great wall of FUD
On Friday, the People’s Bank of China (PBoC) published a memo announcing a ban on all crypto transactions that triggered an 8% dip in the price of Bitcoin along with a wider pullback across the crypto market.
The PBoC’s updated measures — which were initially published on Sept. 3 before it was picked up by western media outlets last week — outlined that financial institutions and payment firms are barred from providing any services related to crypto transactions.
While FUD from Chinese regulators has historically impacted crypto markets, it has also served as a catalyst for surging prices or bull runs in the subsequent months following the announcements.
In September 2017, China’s government banned crypto exchanges from offering services to users in the country while also barring citizens from participating in initial coin offerings. Following the double ban, the price of BTC made the historic climb from the $4,000 range to a then all-time high price of around $20,000.