Cryptocurrency Investment Products
Investors showed interest in Cardano ($ADA) as cryptocurrency investment products saw significant inflows of $3.7 million last week. These inflows, however, were lower than seen for Bitcoin, Ethereum, and multi-asset investment products. CoinShares’ Digital Asset Fund Flows report showed $151 million in inflows in the first week of the year, with Bitcoin leading the way with $113 million.
Inflows and Altcoins
Over the past nine weeks, Bitcoin had 3.2% of its total assets under management in inflows. While Ethereum-focused investment products saw $29.6 million of inflows, investment products focusing on multiple cryptocurrencies saw $5.4 million of inflows. Other altcoins had modest inflows, with Cardano and Avalanche standing out as the exception with $3.7 million and $2 million inflows, respectively.
Blockchain Equities
Blockchain equities saw $24 million of inflows over the past week, according to the report. Investors likely showed interest in Bitcoin-focused investment products amid expectations of a spot Bitcoin exchange-traded fund (ETF) being approved in the United States. Proponents believe a Bitcoin ETF could bring in institutional and retail investors on the sidelines, allowing them to gain exposure to the cryptocurrency without dealing with any private keys.
Cardano’s Recent Developments
Cardano-focused products likely performed well as Cardano maintained its top position in cryptocurrency development activity. The project’s public pre-production environment Kusama ($KSM) also showed progress. Cardano has seen its decentralized finance (DeFi) ecosystem steadily grow, with a spike from $50 million to over $400 million in total value locked last year. At the time of writing, it’s at $350 million.
Hot Take
Overall, Cardano and other altcoins saw significant inflows over the past week, but inflows to Cardano products were notably lower than those seen for Bitcoin, Ethereum, and multi-asset investment products. The interest in blockchain equities continues to grow, showing the market’s growing attractiveness to investors. The continued development and growth of Cardano’s DeFi ecosystem may further strengthen its position in the market, despite lagging inflows when compared to other cryptocurrencies.
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