Digital Asset Investment Products Witness Inflows After 5 Weeks Of Decline

Key Points:

• Digital asset investment products break a five-week streak of outflows, attracting $130 million globally.
• Despite the influx, ETP volumes declined to $8 billion, notably in the US, where Grayscale sees its lowest outflows since January.
• Bitcoin sees a resurgence with $144 million in inflows, but Ethereum faces uncertainty as US regulators’ lack of action on spot Ethereum ETFs sparks speculation.

In a notable turn of events, digital asset investment products have recorded inflows for the first time in five weeks, amassing a total of $130 million.

Digital Asset Investment Products Break Outflow Trend

However, despite this positive uptick, Exchange-Traded Product (ETP) volumes continued their descent, with a weekly figure of $8 billion, notably lower than April’s average ofS$17 billion. This decline underscores a waning participation of ETP investors in the crypto ecosystem, constituting only 22% of total volumes on global trusted exchanges, down from 31% the previous month.

The United States emerged as a key player in digital asset investment products, witnessing the lion’s share of inflows at $135 million. Notably, Grayscale, a prominent incumbent, experienced its lowest weekly outflows since January, amounting to $171 million. Meanwhile, Switzerland saw inflows totaling $14 million.

Contrary to previous weeks, Hong Kong experienced a significant drop in inflows, with just $19 million recorded, signaling that the surge in inflows following the launch of Bitcoin ETFs may have been largely driven by seed capital. On the other hand, Canada and Germany continued to grapple with outflows, totaling $20 million and $15 million, respectively, bringing their year-to-date outflows to a combined $660 million.

Bitcoin Resurgence Amid Ethereum Uncertainty

Bitcoin itself saw an encouraging influx of $144 million, reclaiming lost ground from what had been a lackluster month. Conversely, short-Bitcoin ETPs witnessed outflows totaling $5.1 million, continuing a trend of outflows over the past 8 weeks amounting to $18 million.

Moreover, the subdued response from US regulators regarding spot Ethereum ETF applications has fueled speculation about delayed approvals, potentially contributing to Ethereum-related outflows totaling $14 million last week.