Crypto assets have fallen to a new low since July 2021

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During the week ending on May 20, $141 million in outflows were recorded from digital asset funds, a figure not seen since July 2021. Institutional investors reduced their total assets under management (AUM) to $38 billion by withdrawing $141 million from digital asset investment products during the week ending on May 20.

According to the most recent edition of CoinShare’s weekly Digital Asset Fund Flows report, Bitcoin (BTC) was the main target of withdrawals, which fell by $154 million for the week. The departure of cash occurred during a volatile week in which the price of BTC varied between $28,600 and $31 ,430.

Despite the large outflow, the month-to-date BTC flow for May was still positive at $187.1 million, while the year-to-date figure was $307 million. On a brighter note, last week saw a total of $9.7 million in inflows into multi-asset investment products. This brings the yearly total inflow into these products to $185 million, or 5.3% of overall AUM.

Multi-asset investment products attracted inflows following the spike in volatility, according to Blockchainsight, which cited a possible cause for the greater influx of cash into multi-asset investment products when compared to single-line investing instruments during volatile periods. These investments have only seen outflows for two weeks throughout this year.

The number of new cryptocurrency investors grew by 70 percent in Q1, with $3 billion in investment. Ripple (XRP) and Solana (SOL) were the only coins to see inflows increase over $500,000 during the quarter, according to CoinMarketCap.

Flows by asset during the week ending May 20, 2022. Source: CoinShares

Out of all the assets we’ve looked at thus far, Ethereum (ETH) has had the worst year-to-date performance, with $44 million worth of outflows in May.

The growing popularity of gold and other precious metals as a safe-haven investment shows that investors are becoming more cautious about digital asset investments. This comes amid the backdrop of a strengthening dollar, which has been “one of the most important macro factors driving asset prices over the last six months,” according to cryptocurrency market intelligence firm Delphi Digital.

U.S. dollar currency index. 1-week chart. Source: Delphi Digital

The Dollar Index (DXY), as shown in the chart above, has gained 6.8% thus far this year, reaching 102 on May 23 after rising from 95 at the start of 2022. This is the fastest year-over-year change for the DXY in recent history, and it resulted in its breakout from a seven-year range.

“This DXY strength has been a consistent drag to risk asset performances throughout this same time period,” according to Digital Delphi.

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