Crypto Products See Inflows Despite Sinking Market

Digital asset investment products saw inflows amounting to $40 million last week, in spite of sinking crypto markets.

Following four weeks of outflows, investors adding to their positions by taking advantage of the substantive price discounts were responsible for last week’s inflows, according to the latest CoinShares report. Inflows into North American investment products dominated last week, totaling $66 million, which were countered by $26 million in outflows from European products.

Despite this past week’s inflows, the report expressed some skepticism about whether the negative sentiment over the previous four weeks had run its course. It reasoned that recent investment product trading activity did not match that historically seen during extreme price weakness periods.

Coin flows

As usual Bitcoin-based investment products saw the largest share of flows, this past week amounting to $45 million. While these products experienced the most positive sentiment from investors recently, total assets under management for Bitcoin-based products have fallen to a level seen during a similar period of lower sentiment towards the beginning of the year.

But while Bitcoin-based products surged, Ethereum-based investment products continued its negative streak, with outflows amounting to $12.5 million. This brings total year-to-date outflows to $207 million, which represents 0.8% of AuM overall. 

Among other altcoins, Solana was the only to see any notable inflows, amounting to $1.9 million, while Cardano and Ripple each received $200,000 in inflows, and Polkadot saw $400,000 in outflows. Additionally, multi-asset investment products also saw inflows over the past week, which amounted to $1.7 million.

As a sign of the persistent negative sentiment, Short Bitcoin experienced the second-largest weekly inflows on records at $4 million. While AuM for these products has reached a record high of $45 million, this remains just a 0.15% of Long Bitcoin investment products.

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Nicholas Pongratz

Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage.

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