• Last week, Bitcoin-tied investment funds saw $116 million in inflows as the leading cryptocurrency has managed to hold gains and stay firm so far this year.
• CoinShares reported that the cumulative asset under management (AuM) of crypto funds has risen to $28 billion, up 43% from their November 2022 lows.
• Germany accounted for 40% or $46 million of all inflows, followed by Canada, the United States, and Switzerland with respective figures of $30 million, $26 million, and $23 million.
Bitcoin Sees Strong Inflows Amid Price Surge
Bitcoin has seen strong inflows last week as the flagship cryptocurrency has managed to hold gains and stay firm so far this year. According to a report by digital investment company CoinShares, Bitcoin-tied investment products saw $116 million in inflows last week – the largest since July 2022 – pushing the cumulative asset under management (AuM) of crypto funds up to $28 billion.
Investment Product Volumes Improve
The report also noted that investment product volumes are improving significantly with over $1.3 billion traded last week – a 17% increase compared to the YTD average – while total digital asset market volumes have seen an 11% rise on trusted exchanges. Multi-asset investment products experienced outflows for 9 consecutive weeks amounting to $6.4 million indicating that investors are now preferring select investments such as Solana, Cardano and Polygon which saw inflows while Bitcoin Cash, Stellar and Uniswap all had minor outflows during this period.
Geographical Breakdown of Inflows
CoinShares’ report revealed a geographical breakdown of inflows where Germany was at the top with 40% or $46 million followed by Canada ($30m), USA ($26m) and Switzerland ($23m). The strong inflows come amid increasing adoption for Bitcoin as CoinShares earlier this month reported that digital asset inflow reached its lowest since 2018 at around 433 Million USD with Bitcoin accounting for 287 Million USD and Multi-asset Investment products at 209 Million USD in flows during this period.
Fund Flows Can Predict Price Movements
Fund flows can be used as an indicator to gauge how institutional investors move their money; generally it is assumed that strong inflows will lead to more buying pressure driving prices higher while outflow activity could result in lower prices due to reduced demand.
Conclusion
In conclusion, last week’s strong inflows into BTC is indicative of increased investor confidence in cryptocurrencies which may further fuel positive price movements going forward if similar trends continue in upcoming weeks.