Positive Inflows into Institutional Crypto Products
A new report by CoinShares reveals that investments into institutional crypto products have been positive for the fourth consecutive week. These products include exchange-traded products that track cryptocurrencies, such as those offered by Grayscale, 21shares, and Proshares. Last week, a total of $66 million was invested, with the majority (83.7%) going towards Bitcoin. Swiss-based firm 21SharesAG received the largest inflows of $45.5 million, followed by German digital securities provider ETC Group with $12.2 million. However, the U.S.-based ProShares Bitcoin Strategy ETF experienced outflows of $10.7 million.
Spot Bitcoin ETF in Focus
Compared to June when investments amounted to approximately $807 million, the recent four-week inflows of $179 million have been relatively low. James Butterfill, head of research at CoinShares, suggests that this indicates a more cautious approach by investors this time around. Several Bitcoin ETF applicants in the U.S., including BlackRock, Fidelity, and Ark Invest, made amendments to their filings in recent weeks. Grayscale also filed a new registration application to convert its Bitcoin Trust Shares (GBTC) to an ETF following a court case victory against the SEC.
Solana Leads Altcoin Inflows
After Bitcoin, Solana has emerged as the preferred altcoin investment choice for institutional investors. It accounted for 23.4% of total weekly inflows at $15.5 million and has attracted $43 million in inflows over the past month and $74 million year-to-date. On the other hand, Ethereum witnessed outflows of $7.4 million due to ongoing concerns over its centralization and increasing hardware requirements for running nodes. Ethereum-based products have seen outflows totaling $119 million this year, making it the “least loved digital asset” for ETP investors.
Hot Take: Institutional Investors Show Caution in Crypto Investments
Institutional investors have continued to invest in crypto products, but recent inflows have been relatively low compared to earlier this year. This cautious approach may be attributed to the anticipation of a spot Bitcoin ETF launch in the U.S. Some major players in the industry, including BlackRock and Grayscale, have made amendments to their filings, indicating positive developments. Solana has emerged as the preferred altcoin investment choice after Bitcoin, while Ethereum has experienced outflows due to concerns over centralization and hardware requirements. Overall, institutional investors are closely watching the evolving regulatory landscape and adjusting their investment strategies accordingly.
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