Global crypto investment products have witnessed a remarkable surge, recording a substantial $1.2 billion in net inflows over the past week. This marks the third consecutive week of positive inflows and underscores a significant shift in market sentiment. The latest report from CoinShares, a leading digital asset investment firm, highlights this positive trend.
CoinShares revealed that the increase in inflows reflects growing “investor confidence” in digital assets amidst expectations of more “dovish monetary policy” in the US. Additionally, it is seen as a reaction to improving “price momentum” in the market.
According to James Butterfill, CoinShares’ Head of Research, this week’s performance is the largest in the last ten weeks, with total assets under management rising by 6.2%. The inflow predominantly stemmed from heightened interest in Bitcoin-focused investment products.
After weeks of lackluster performance, Ethereum-based investment funds also recorded a resurgence, attracting net weekly inflows and marking a positive turnaround in investor sentiment towards the asset.
Bitcoin Dominates Inflows as Spot ETF Approval Boosts Market
The primary driver behind last week’s inflows was Bitcoin, which accounted for a staggering $1.1 billion of global net inflows.
Butterfill noted that the approval for the listing and trading options of BlackRock’s spot Bitcoin exchange-traded fund (ETF) by the US Securities and Exchange Commission (SEC) significantly contributed to market optimism.
This regulatory development set a positive tone for investors, despite a minor decline in trading volumes, which decreased by 3.1% compared to the previous week.
Investment funds based in the US were the major contributors to the inflows, with spot Bitcoin ETFs making up the majority. The US-based funds generated a net inflow of $1.2 billion, with $1.1 billion coming from Bitcoin-focused products.
Additionally, Switzerland-based crypto funds drew in net inflows of $84 million. However, this positive trend was not uniform across all regions, as funds in Germany and Brazil experienced net outflows of $21 million and $3 million, respectively.
Interestingly, short Bitcoin investment products also saw net inflows of $8.8 million amid the price increase for Bitcoin.
Ethereum Sees Rebound, Solana Ends Positive Streak
One of the noteworthy developments was the reversal of a five-week negative trend in Ethereum-based investment products. These funds attracted net inflows of $87 million globally, with US-based spot Ethereum ETFs contributing $85 million.
This marks the largest net weekly inflow for Ethereum funds since August and suggests renewed confidence in the asset’s medium-term prospects.
In contrast, Solana-based investment products ended their five-week streak of net inflows. During the last week, $4.8 million was withdrawn from Solana funds globally.
While Solana had experienced a period of growth and positive sentiment, the reversal indicates that investors may be looking to shift their focus to more established assets like Bitcoin and Ethereum in the short term.
