- Ethereum’s Coinbase Premium Index (CPI) recently shifted into negative territory, indicating a decrease in institutional investors’ accumulation activities on Coinbase.
- According to an analyst, this change in sentiment is noteworthy because it suggests that investors have the capacity to influence the asset’s price movements.
- Altcoin reached the psychological price level of $2000 in April but has since shown a downward trend and remained stuck in a narrow range.
Current data on Ethereum indicates a decline in institutional investor interest; will this have an impact on ETH price?
Are Institutions Still Interested in Ethereum?
Ethereum’s Coinbase Premium Index (CPI) recently shifted into negative territory, indicating a decrease in altcoin accumulation activities by institutional investors in the United States through Coinbase. These findings were published by CryptoQuant analyst.
CPI is a metric that measures the difference between the price of an asset on Coinbase and Binance. If a asset’s CPI value is positive, it indicates strong buying pressure among institutional investors on Coinbase. Conversely, when the CPI metric returns a negative value, there is less accumulation activity on Coinbase.
The analyst analyzed ETH’s CPI on a 30-day moving average and stated, “There is a significant change in sentiment in the American market, as evidenced by the significant downward trend in the premium index.”
As of the time of writing this article, ETH’s CPI was a negative value for the first time in the past month, at -0.0027.
The analyst also noted that this change in sentiment is noteworthy because “many American investors are wealthy individuals or institutional organizations,” and therefore they have the capacity to influence the asset’s price movements.
When commenting on the impact of the CPI decline on the ETH market, the analyst added:
“This behavior could shed a negative light on ETH’s prospects. It implies that these investors are likely not willing to accumulate ETH in this price range and likely signifies a prevailing bearish sentiment in the market.”
Not Just America…
An evaluation of the flow of funds into digital asset investment products showed significant outflows from ETH this year.
Altcoin reached the psychological price level of $2000 in April but has since shown a downward trend and remained stuck in a narrow range. This has somewhat eroded investor confidence and led to a return of negative sentiment in the market. As of August 4th, outflows from ETH this year totaled $76 million.
