Cryptocurrency investment flows this week have flowed into Ethereum (ETH)-based products, noted CoinShares head of research James Butterfill.
In a recent report, Butterfill noted that Ether, the second-largest cryptocurrency by market cap, emerged this week as the leader in investment in digital asset-based products.
According to the report, the Ethereum cryptocurrency managed to attract a significant amount of capital inflows of $155 million amid the market correction. Bitcoin, which had so far led the inflows into crypto-asset investment funds, recorded a significantly smaller inflow of only $13 million over the same period.
This phenomenon, according to Butterfill, reflects a renewed interest from investors in Ether-based funds, which could signal a significant shift in the dynamics of the cryptocurrency market.
Investment flows are flowing into Ethereum
According to CoinShares’ #195 report on crypto fund inflows, Ethereum received the largest capital injection over the past 7 days. According to the data, digital asset investment funds recorded a total of $176 million, so the $155 million that Ethereum received in the past week represents 88% of the total flows into these investment products.
Source: coinshares
Growth in investment in Ethereum has raised total annual flows to $862 million, representing the highest figure since 2021.
Butterfill commented that interest in Ether was largely driven by the market's price correction, possibly because investors saw the drop as a buying opportunity. Due to the events that marked Black Monday on August 5, the Ethereum price was quoted at around $2.200 per ETH. He also highlighted the launch of Ethereum spot ETFs in the United States as instruments that are significantly facilitating access to the cryptocurrency for a wider range of investors.
Optimism prevails among cryptocurrency investors
Despite the correction suffered by cryptocurrencies last week, Butterfill noted that the optimistic sentiment seems to continue to dominate the market. Geographically, all regions recorded positive inflows into digital asset investment funds, with the United States leading the way.
As for Bitcoin, the expert stressed that while the cryptocurrency started the week with outflows, it nevertheless closed with significant inflows that raised weekly flows to $13 million.
“Unusually, all regions saw inflows last week, suggesting unanimous positive sentiment towards the asset class following the recent price correction.”, Butterfill noted.
Funds based on Solana, XRP, Cardano and Litecoin also saw positive inflows in the past week, which can be attributed, according to Butterfill, to several factors. Among them, the current market context, which has created a favorable environment for investors looking to diversify their portfolios with digital assets. Also, the accessibility that ETFs offer to the main crypto assets on the market has favored the flow of capital into digital assets.
Finally, the report also highlighted that the ability of cryptocurrencies to attract capital during periods of market correction highlights the resilience and attractiveness of these digital assets as a viable alternative investment option for investors.
Backed by growing institutional interest and a favorable investment environment, cryptocurrencies are increasingly positioning themselves as key players in the global financial landscape.
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