Crypto Investment Products See Inflows After Six-Week Outflow Streak
After experiencing six consecutive weeks of outflows, digital asset investment products at asset managers like CoinShares, Grayscale, 21Shares, Bitwise, and ProShares have seen inflows of $21 million in the past week. This marks a turnaround for crypto funds, which had seen nearly half a billion dollars in aggregated outflows over a ten-week period. Bitcoin dominated the inflows, adding $20.4 million in the last week. Short bitcoin investment products, on the other hand, saw $1.5 million withdrawn, contributing to the $85 million in outflows since April.
Solana funds continue to perform well with $5.1 million in inflows last week, marking the 27th week of inflows this year and only four weeks of outflows in 2023. However, ether products experienced outflows for the seventh consecutive week, shedding $1.5 million.
Changing Momentum Drives Inflows
The sudden influx of funds can be attributed to positive price momentum, concerns about U.S. government debt prices, and the recent deadlock over government funding. CoinShares Head of Research James Butterfill explained that although earlier in the week it seemed like there would be another week of outflows, the inflows came late in response to these factors. Despite the recent price pick-up, volumes remain seasonally low in both the investment product market and the broader crypto market.
Regional Divergence and Blockchain Equities
While Europe and Canada saw inflows of $23 million and $17 million, respectively, the U.S. experienced outflows of $19 million. Blockchain equities also faced a challenging week, with outflows of $8.4 million, aligning with the broader sell-off in the tech sector.
Hot Take: Crypto Investment Products Bounce Back with Inflows
After a period of sustained outflows, crypto investment products have seen a resurgence with $21 million in inflows over the past week. Bitcoin remains the dominant choice for investors, while solana funds continue to perform well. However, ether products have experienced seven consecutive weeks of outflows, making it the “least loved” altcoin. The recent influx can be attributed to positive price momentum and concerns over U.S. government debt prices. Despite this positive development, trading volumes remain relatively low in both the investment product market and the broader crypto market. Additionally, regional divergence was observed, with Europe and Canada experiencing inflows while the U.S. saw outflows. Blockchain equities also faced challenges during this period.
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