Digital asset investment products saw significant inflows for the second consecutive week, with investors pouring $321 million into the industry, according to CoinShares‘ latest weekly report. This influx boosted the total assets under management (AuM) for crypto exchange-traded products (ETPs) by 9%, bringing the total to $85.8 billion. The overall investment product volume also increased to approximately $9.5 billion. James Butterfill, head of research at CoinShares, attributed this positive trend to the Federal Reserve’s recent decision to cut interest rates by 50 basis points, which led to a surge in investor interest.
Bitcoin-based investment products led the inflows, generating $284 million in net gains globally last week. Major crypto funds from firms like BlackRock, Bitwise, Fidelity, ProShares, and 21Shares contributed to this rebound, collectively adding $321 million in net inflows. Additionally, the positive price momentum for Bitcoin attracted investors with bearish sentiment, who allocated $5.1 million to short-Bitcoin funds. On the other hand, Ethereum faced its fifth consecutive week of outflows, totaling $29 million. This trend is attributed to ongoing withdrawals from Grayscale’s ETHE product and declining interest in new offerings. Solana, however, maintained its positive trend, adding $3.2 million in inflows last week.
The US emerged as the leading contributor to last week’s inflow, accounting for $277 million, followed by Switzerland with $63 million. In contrast, Germany, Sweden, and Canada experienced outflows of $9.5 million, $7.8 million, and $2.3 million, respectively. This data suggests that investor sentiment towards digital assets remains strong, with continued interest from institutional investors and traditional financial institutions. The Federal Reserve’s recent actions and dovish stance on interest rates have also played a significant role in driving inflows into digital asset investment products.
The positive trend in inflows for digital asset investment products reflects a growing interest in cryptocurrencies and blockchain technology among investors. The increasing AuM for crypto ETPs highlights the maturation of the digital asset market and the growing acceptance of cryptocurrencies as a legitimate investment asset class. With major players like BlackRock, Bitwise, Fidelity, ProShares, and 21Shares contributing to the inflows, it indicates a broader institutional acceptance of digital assets.
Overall, the influx of $321 million into digital asset investment products last week signals a bullish sentiment towards cryptocurrencies, particularly Bitcoin, among investors. Despite Ethereum facing outflows for the fifth consecutive week, other altcoins like Solana, XRP, and Litecoin also saw inflows, indicating some diversification in investor interest. The dominance of the US in contributing to inflows highlights the country’s leading position in the digital asset market, followed by Switzerland. As more traditional financial institutions announce plans to launch services on blockchain networks like Solana, it further solidifies the growing adoption of digital assets in traditional finance.
