Investment funds supported by digital assets experienced their largest weekly inflows in a year last week, with a notable $199 million added to the sector. These inflows were the largest since July 2022 and made up almost half of the prior nine consecutive weeks of outflows, according to a fund flows report by the crypto investment and research firm CoinShares.
The significant change from the previous week saw net outflows of $5.1 million. The recent surge in inflows was primarily driven by funds backed by Bitcoin (BTC), which experienced inflows of $187 million for the week, compared to net outflows of $0.5 million in the week prior.
It is important to highlight that these Bitcoin flows accounted for a staggering 94% of total flows last week, suggesting the dominance of Bitcoin over other cryptoassets among investors in crypto-backed funds. Interestingly, the category witnessing the largest outflows last week were short-Bitcoin funds, indicative of an improved sentiment among Bitcoin investors.
Among altcoin-backed funds, Ethereum (ETH) funds stood out, with inflows amounting to $7.8 million. Funds backed by baskets of multiple digital assets also benefited, with inflows reaching $8.1 million.
It is noteworthy that Germany saw the largest inflows for the week, with a substantial increase from $2.4 million to $85.5 million. The United States and Canada followed suit, responsible for inflows of $58.9 million and $45.3 million, respectively.
Crypto-backed fund inflows received an additional boost after BlackRock, the world’s largest asset management firm, filed an application on June 15 to list a spot Bitcoin exchange-traded fund (ETF). CoinShares attributes the renewed positive sentiment to recent announcements from high-profile ETP issuers filing for physically backed ETFs with the US Securities & Exchange Commission.
Total assets under management in crypto-backed funds now stand at an impressive $37 billion, their highest level since before the collapse of 3 Arrows Capital.
Although the recent uptick in fund inflows is certainly promising, it is crucial to consider the inherent volatility of the crypto markets. Investors should exercise caution and conduct thorough research when allocating funds to digital assets. Nonetheless, the growing interest and involvement of established financial institutions signify a step closer towards mainstream adoption and improved market stability.
Source: Cryptonews
