Digital Asset Fund Flows Surge in 2023: CoinShares
Crypto investment products experienced a significant recovery in 2023, with inflows increasing nearly threefold compared to the previous year, according to digital assets manager CoinShares. In its latest report on Digital Asset Fund Flows, CoinShares revealed that inflows reached $2.25 billion in 2023, representing a 2.7 times year-on-year increase. Additionally, total assets under management (AuM) rose by 129%, reaching $51 billion by the end of December 31st, marking the highest level since March 2022.
US Lags Behind in AuM
Although the US saw the largest inflows of $792 million, it only accounted for 2% of AuM. In contrast, Germany had the largest inflows at 22% of AuM, followed by Canada and Switzerland at 15% and 13%, respectively. CoinShares suggests that the reason for the US’s lower AuM could be investors’ preference for spot-based exchange-traded funds (ETFs).
Bitcoin Dominates Inflows
The report highlights that Bitcoin received $1.9 billion worth of inflows in 2023, accounting for 87% of the total flows. This makes Bitcoin the primary beneficiary of improved investor sentiment. The dominance of Bitcoin in terms of flows is unprecedented, surpassing previous peaks in 2020 and indicating no discernible trend.
Optimism Surrounding SEC ETF Approval
CoinShares notes that much of the recovery in crypto asset inflows occurred in the last quarter of 2023. This coincided with optimism surrounding the potential approval of the first Bitcoin spot-based ETF by the US Securities and Exchange Commission (SEC).
Hot Take: Crypto Investment Products Surge in 2023
The crypto market experienced a significant rebound in 2023, with crypto investment products witnessing a substantial increase in inflows. CoinShares’ report highlights the recovery in the industry, as inflows reached $2.25 billion and total assets under management rose to $51 billion. Bitcoin emerged as the biggest beneficiary, receiving $1.9 billion worth of inflows. The US lagged behind in assets under management, potentially due to investors’ preference for spot-based ETFs. Overall, 2023 marked a promising year for the crypto market, driven by increased investor sentiment and anticipation of regulatory developments.
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