Bitcoin traded lower on Monday, slipping 0.6% to $70,306 after a volatile session that saw prices swing between $68,371 and $72,024. The modest decline comes as institutional capital remains cautious, with net outflows from digital asset investment products slowing to $187 million last week, according to data from CoinShares.
Institutional Flows Show Caution
While the pace of withdrawals has moderated, the overall trend suggests continued investor wariness. CoinShares reported that total assets under management now stand at $129.8 billion, with exchange-traded product volumes recently hitting a record $63.1 billion. Bitcoin-specific funds experienced $264 million in net outflows during the period.
Regulatory Pressure Intensifies
Regulatory concerns resurfaced after South Korea's Financial Supervisory Service pointed to Bithumb's accidental distribution of $40 billion worth of bitcoin as evidence for stricter oversight. The incident triggered significant market selling before authorities recovered approximately 99.7% of the 620,000 bitcoins mistakenly distributed. Governor Lee Chan-jin described the episode as revealing "structural problems" in virtual asset systems.
Macroeconomic Factors at Play
Currency markets provided little support for risk assets, with the yen strengthening against the dollar following Prime Minister Sanae Takaichi's election victory in Japan. The greenback fell approximately 1% to 155.70 yen, a move analysts attributed partly to political developments. Traders now await upcoming U.S. economic data that could influence Federal Reserve policy decisions.
Ether managed gains amid the mixed environment, rising 1% to $2,118 after trading between $2,010 and $2,141 earlier in the day. Cryptocurrency-related equities showed resilience, with Coinbase advancing 1.3% to $167.25 and Strategy climbing 2.6% to $138.44.
Market observers note that corporate holders of digital assets face pressure amid the sector's volatility, with the $2 trillion decline in total cryptocurrency value squeezing balance sheets. Many firms now trade below their asset values, with few maintaining substantial cash reserves like Strategy.
Attention now shifts to the upcoming U.S. consumer price index report scheduled for February 13, which historically moves Treasury yields, dollar valuations, and risk appetite—factors that typically produce swift reactions in bitcoin markets.
