The worldwide cryptocurrency market continues to draw significant investor interest as crypto investment products recorded a considerable influx of funds last week.
In accordance with CoinShares’ latest weekly report, crypto funds registered a net inflow of $2.19 billion globally, bringing year-to-date (YTD) net inflows to a record high of $33.5 billion.
The surge in inflows coincided with Bitcoin’s recent rally to a latest all-time high of $93,477, which contributed to CoinShare’s total assets under management (AUM) for crypto funds reaching roughly $138 billion.
Global Distribution Of Crypto Inflows And Key Trends
US-based funds primarily drove the inflows, accounting for $2.21 billion of the full weekly inflow. Other regions, including Hong Kong, Australia, and Canada, contributed net inflows of $27 million, $18 million, and $13 million, respectively.
Alternatively, investors in Sweden and Germany opted to take profits, leading to regional net outflows of $58 million and $6.8 million, respectively. Meanwhile. Bitcoin-based products continued to dominate the market, attracting $1.48 billion in net inflows globally over the week.
The renewed interest in Bitcoin coincided with its price surge but in addition spurred a notable increase in short-Bitcoin investment products, which received $49 million in latest investments. This development reflects investor skepticism or hedging against potential price pullbacks following the recent highs.
Ethereum-based products, which have faced challenges in recent months, showed signs of recovery by registering net inflows of $646 million globally.
CoinShares Head of Research James Butterfill highlighted that the turnaround might need been influenced by a mixture of market aspects, including a proposed network upgrade dubbed the Beam Chain by Ethereum researcher Justin Drake and market optimism driven by the US elections. Ethereum inflows represented 5% of the asset’s total AUM, indicating renewed investor confidence.
Behind The Surge
Just because the inflow seen in Ettherum, Butterfill also noted that the general spike in crypto fund inflows last week appears to be driven by a combination of market aspects, including a shift in US monetary policy and the impact of the Republican party’s sweeping victory within the US elections.
Butterfill further revealed that although the week began with $3 billion in net inflows over the primary few days, a subsequent $866 million outflows was observed following Bitcoin’s all-time high (ATH).
Speaking of BTC’s ATH, following the achievement of the height above $93,000 on November 13, BTC has seen a noticeable correction in price.
Thus far, Bitcoin has dropped by 2.8% from this ATH of $93,477 because it currently trades for $90,334 on the time of writing albeit up barely by 0.2% previously day.
Interestingly, over the past few days since BTC began this correction, its each day trading volume has also seen quite a major drop in valuation dropping from above $70 billion last week to $59 billion today.
Featured image created with DALL-E, Chart from TradingView