The digital asset market is gaining investor interest, with cryptocurrency investment products experiencing inflows for the fifth week.
Last week, these products saw $1.3 billion in inflows, accumulating a total of $7.3 billion for the year, according to a CoinShares report.
Despite these inflows, the total assets under management (AUM) in exchange-traded products (ETPs) declined to $163 billion, down from the January high of $181 billion, following recent price drops in the market. Trading volumes, however, remained robust at $20 billion for the week.
Ethereum (ETH) emerged as the frontrunner, attracting $793 million in inflows as its price dipped to approximately $2,100. CoinShares’ head of research, James Butterfill, attributed this surge in investment to “significant buying-on-weakness,” indicating that investors saw the price drop as a buying opportunity.
Bitcoin (BTC) experienced significant inflows, with $407 million entering related investment products. Exchange-traded products now constitute about 7.1% of Bitcoin’s total market capitalization. The U.S. led the way with $1 billion in inflows, while European markets, including Germany, Switzerland, and Canada, saw investments of $61 million, $54 million, and $37 million, respectively. Among altcoins, XRP and Solana (SOL) also gained traction, attracting $21 million and $11 million. Additionally, blockchain-related equities drew in $33 million, bringing the sector’s total inflows to $194 million for the year.
Butterfill noted that macroeconomic factors, including geopolitical and trade concerns, influence market sentiment.
“While Trump’s tariff rhetoric is often a strategic opening gambit for better trade terms, the prospect of a full-scale trade conflict remains a major concern,”
he said.
“Bitcoin, which trades 24/7, has already reflected these fears over the weekend, and equities have followed suit.”
This report follows Butterfill’s earlier analysis in October 2024, suggesting a shift in investor focus from traditional monetary policy to the U.S. elections. The recent uptick in digital asset inflows indicates that investors are increasingly positioning themselves in crypto markets ahead of potential political and economic shifts.
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