Crypto Investment Inflows Hit One-Year High
Crypto investment products are once again proving their appeal in the market, with inflows reaching their highest level since July 2022. European asset management firm, CoinShares, noted an inflow of $199 million the last week, signaling renewed investor interest in the crypto space.
The surge is seen as a correction, offsetting almost half of the outflows seen over the previous 9 weeks. CoinShares attributed the increase to recent filings of physically backed ETFs from top-tier issuers. In particular, the crypto market is clearly experiencing a resurgence in enthusiasm as global asset management giants such as BlackRock file applications for spot Bitcoin ETFs.
Bitcoin takes the lion's share
In this wave of increased inflows, Bitcoin emerged as the undisputed favorite. Bitcoin-centric investment products saw inflows of $188 million last week, according to CoinShares.
On the other hand, short bitcoin continued its trend of nine consecutive weeks of releases, reaching $4.9 million. These contrasting trends speak to Bitcoin's continued appeal amid market swings.
Ethereum also saw inflows, albeit on a relatively smaller scale of $7.8 million. Data from CoinShares implies a currently subdued investor appetite for Ethereum relative to Bitcoin.
Notably, despite the dominance of Bitcoin and Ethereum, there is a visible, albeit "very minor" flow to alternative cryptocurrencies, such as XRP and Solana. This indicates diversified market interest, although it does not match the scale of major cryptos.
Improved market sentiment is also persuading investors towards multi-asset investing ETPs. These ETPs saw an inflow of $8 million last week, further underscoring the continued diversification of investor interests in the crypto asset class.
Record high for crypto assets under management
With the increase in inflows, fund managers' total assets under management (AUM) also reached $37 billion. This is the highest level seen since before the collapse of Three Arrows Capital. This underscores not only the resilience of the crypto market, but also the continued confidence investors place in it.
It should be noted that along with the increase in crypto investment flows, the crypto market, especially large crypto assets such as Bitcoin and Ethereum, has seen a rebound in its losses in the lawsuit. the United States Securities and Exchange Commission (SEC) against Binance and Coinbase.
Over the past day, Bitcoin saw a slight decline of 0.6%, but its trading price continues to hover above the recently recovered benchmark of $30,000. The past week has seen an addition of over $70 billion to Bitcoin's market capitalization, taking it from a low of $514 billion the previous Monday to over $580 billion today.
In the meantime, Ethereum has been on the close for the past 24 hours with no significant movement. The second-largest asset by market capitalization currently has a daily trading volume of over $8 billion and a market capitalization of $226 billion.
Featured image from Unsplash, chart from TradingView