The cryptocurrency market witnessed a major influx of investments last week as notable factors played a key role in changing investor sentiment.
According to the latest report According to CoinShares, digital asset investment products saw $407 million in net inflows globally, marking a strong recovery after a previous week of outflows. This increase in entries has been mainly attributed to an interesting trend in the United States.
bitcoin Leads Fund Inflows as ethereum Sees Continued Outflows
bitcoin investment products were the biggest leader in fund flow last week, attracting $419 million in net inflows, according to data from CoinShares.
Interestingly, short bitcoin investment products, designed to profit from bitcoin price declines, recorded outflows of $6.3 million, reflecting growing bullish sentiment around the cryptocurrency.
US spot bitcoin exchange-traded funds (ETFs) also accounted for $348.5 million in net inflows last week despite witnessing brief outflows from Tuesday to Thursday.
The week closed strongly with over $200 million in positive flows on Monday and Friday, indicating renewed investor confidence in the digital asset market.
While bitcoin-related products enjoyed significant inflows, ethereum-based funds continued to face challenges. The CoinShares report revealed that ethereum investment products saw net outflows of $9.8 million globally, despite a small inflow of $1.9 million into US spot ethereum ETFs. .
This marks a continuation of the negative trend that ethereum has struggled with in recent weeks, indicating lingering concerns among investors about the asset's near-term prospects.
Other multi-asset investment products, which include exposure to various cryptocurrencies, maintained a positive trajectory. These products recorded their 17th consecutive week of inflows, adding a modest $1.5 million to their total.
Additionally, blockchain stock ETFs saw a notable surge, generating $34 million in inflows, making it one of the largest weekly increases of the year. Butterfill attributed this rise to the recent gains in bitcoin price, further solidifying the connection between bitcoin's performance and the overall health of the crypto market.
What drove the $407 million ticket increase?
CoinShares Head of Research James Butterfill highlighted the impact of US political events on the inflows trend.
“Investor decisions have probably been influenced more by the upcoming US election than by the outlook for monetary policy,” Butterfill explained, pointing to growing support for digital assets from the Republican Party as a driving factor.
CoinShared's head of research further noted that this shift was evident following the recent US vice presidential debate and polling data showing increased Republican support, leading to an “immediate boost” in entries and votes. cryptocurrency prices.
In terms of regional fund flows, as expected, US-based funds dominated inflows, contributing $406 million to the $407 million total recorded last week.
Aside from the United States, the only other significant contributor to positive inflows came from Canadian crypto funds, which recorded net inflows of $4.8 million. In contrast, funds based in other regions recorded smaller outflows.
Featured image created with DALL-E, TradfingView chart
