This week marked the 7th week of consecutive positive inflows into crypto investment products, totalling $1.14bn and surpassing last year’s inflow of $736m. The pattern of the past weeks matches the inflow pattern last experienced during the end of the previous bull run in December 2021.
With the crypto markets experiencing a significant rally over the past few weeks, inflows into different investment products have picked up as well, as the analysis of crypto asset manager CoinShares shows. Most of the capital went into bitcoin-linked products, but Ether (ETH) and Solana (SOL) also profited from the increased interest.
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US, Germany and Switzerland lead the pack
The data shows investors from the US region are joining the rally. Products traded on US exchanges marked the highest inflow with $156.6m, followed by Germany ($63m), Switzerland ($35.5m) and Canada ($9.2m). Interestingly Swedish products have had an outflow over the past year of $94m but still record the 5th highest AuM ($1’924m) of the compared countries, right after Germany.
With last week's inflows and through the price appreciation of the underlying cryptocurrencies, total Assets under Management (AuM) have risen by 99% since the beginning of the year. Total AuM is $44.3bn, currently at the highest state since major crypto institutions (Terra, Three Arrows Capital, BlockFi, etc.) started failing in May 2022.
Majority of investments secured in bitcoin trust
Investors preferred Bitcoin as an asset class with a weekly inflow of $240m, holding by far the highest total inflow compared to other crypto assets. The same goes for the yearly BTC inflow, which totaled $842m. The confidence in bitcoin investment products such as the Grayscale Bitcoin Trust (GBTC) most likely stems from the anticipation of a spot-based ETF in the US.
Ethereum is only partially recovering from its last year's outflows, seeing inflows of $49.1m this week. This shift in sentiment is likely linked to BlackRock's recent request for a spot-based ETF listing in the US. After Ethereum, the most popular altcoins were Solana ($12.4m) and Cardano ($0.8m).
CoinShares also notes that Bitcoin ETP trading accounted for up to 19.5% of the overall Bitcoin trading volumes. These numbers suggest a greater involvement of ETP investors in the current surge compared to the years 2020/21. The Crypto ETP issuers with the strongest asset inflows over the past year are the Swiss 21Shares and German ETC Group.
