Investments in cryptocurrency-based products are experiencing a promising resurgence, with Bitcoin and Ethereum leading the way.
Data from CoinShares’ latest weekly report on inflows into cryptocurrency-based investment products shows renewed investor confidence in cryptocurrencies and digital assets.
According to this report, published by James Butterfill, head of research at CoinShares, cryptocurrency and digital asset investment products experienced a notable increase in weekly capital flows, reaching a total of $1.200 billion in the last week.
Butterfill noted that this increase came amid growing positive prospects for a more dovish monetary policy in the United States, which has created a more favorable environment for the growth of cryptocurrencies and risk assets.
Ethereum broke its negative streak this week
Ethereum, the second-largest cryptocurrency by market cap, has seen capital inflows for the first time since August, totaling $87 million. According to the report, this change is significant, given that Ethereum had been experiencing a negative streak for five consecutive weeks, during which it saw significant outflows.
Again, Butterfill emphasized expectations of looser monetary policy in the US market as the reason that has largely driven optimism among cryptocurrency investors and renewed demand for these digital assets.
Source: CoinShares
At the report, Butterfill also highlighted that the recent approval of options for certain cryptocurrency-based investment products in the United States has contributed to the renewed interest seen from investors in these financial products. Thus, although trading volumes have decreased slightly by 3,1% compared to the previous week, the increase in capital inflows suggests that investors are beginning to reevaluate their positions in cryptocurrencies, especially in Bitcoin and Ethereum.
Bitcoin accounts for almost 90% of total weekly investment flows
The CoinShares report also revealed that Bitcoin, the market-leading cryptocurrency, benefited the most from this surge of inflows, with an impressive $1.070 billion in capital inflow. This figure represents almost 90% of the inflows recorded by cryptocurrency investment products in the past week. In addition,
This value also reflects investor confidence in Bitcoin, strengthening its position as the most established cryptocurrency in the financial and digital asset sector in general.
Source: CoinShares
Regionally, investment sentiment has shown some divergence, with the United States and Switzerland leading inflows with $1.170 billion and $84 million, respectively. This data is indicative that, despite global economic uncertainty, U.S. investors remain confident in cryptocurrencies as a viable alternative to diversify investment portfolios.
On the other hand, the data in the report also shows that not all cryptocurrencies have performed positively in recent days. For example, Solana experienced capital outflows worth $4,8 million. Until recently, Solana had remained the favorite altcoin of cryptocurrency investors.
A more optimistic outlook for cryptocurrency investment
As macroeconomic conditions change and the cryptocurrency market adapts, the trend towards positive investment flows appears to be consolidating.
With a total of $1.200 billion in the last week, cryptocurrency and digital asset investment products showed a 6,2% growth in assets under management compared to the previous week, reflecting renewed investor confidence in this sector. This increase suggests that investors are willing to take risks in search of higher returns.
Overall, the latest CoinShares report shows that more dovish monetary policy in the United States is playing a crucial role in the revival of crypto investment, prompting investors to explore the opportunities offered by the digital ecosystem and stimulating the recovery of confidence in digital assets.
IMPORTANT: The content of this article is for informational purposes only and, in no case, what is written here should be taken as investment advice or recommendations. Bit2Me News reminds you that before making any investment you should educate yourself and know where you invest your money, as well as the pros and cons of the system. We separate ourselves from the actions and consequences that ignorance may entail. If you decide to invest in this or another asset class, you are solely responsible for the consequences that your decisions and actions may have.
