The digital asset investment landscape witnessed an unprecedented surge as crypto investment products recorded a staggering trading volume of $17.5 billion in the past week. This surge, highlighted in the Coinshares Digital Asset Fund Flows Weekly Report, reveals a significant uptick in interest and activity within the crypto market.
Crypto Frenzy
The report revealed that digital asset investment products attracted substantial inflows of $1.18 billion last week, subject to a T+2 settlement. While this figure did not surpass the record set during the launch of futures-based Bitcoin ETFs in October 2021, which totaled $1.5 billion, it marked a significant increase in investor interest.
One of the key highlights of the week was the remarkable surge in Exchange-Traded Product (ETP) trading volumes. The total trading volume for ETPs reached a staggering $17.5 billion, setting a new all-time high. This figure was notably higher than the average weekly trading volumes of $2 billion observed throughout 2022. These trading volumes accounted for nearly 90% of the daily trading volumes on reputable exchanges last Friday, a notable departure from the typical range of 2%-10%.
The United States emerged as a dominant force in this surge, with $1.24 billion in inflows recorded last week. Simultaneously, Switzerland experienced inflows totaling $21 million. Interestingly, Europe and Canada witnessed outflows, with Canada experiencing $44 million, Germany $27 million, and Sweden $16 million in outflows. Analysts suspect that these outflows may be attributed to basis traders shifting their focus from Europe to the United States.
Bitcoin, the leading cryptocurrency, attracted significant attention with $1.16 billion in inflows, constituting approximately 3% of the total assets under management (AuM). On the other hand, short-Bitcoin products also saw minor inflows totaling $4.1 million. Ethereum, the second-largest cryptocurrency, saw inflows amounting to $26 million, while XRP attracted $2.2 million in investments. Solana, however, proved to be the exception, recording only $0.5 million in inflows for the week.
Beyond digital currencies, blockchain equities experienced substantial inflows totaling $98 million. This brought the total inflows over the last seven weeks to an impressive $608 million, underscoring the growing interest in blockchain-related investments. However, these record-breaking figures may be indicative of a broader trend toward increased institutional adoption and acceptance of cryptocurrencies as a legitimate asset class.
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