Institutional investors are continuing to show strong interest in the cryptocurrency market, with digital assets manager CoinShares reporting that nearly $40 billion has been allocated to crypto products so far this year. According to CoinShares’ latest Digital Asset Fund Flows report, institutional investment in crypto products saw a surge in net inflows last week, bringing total yearly flows to a record-breaking $37.3 billion.
The report highlights the significant growth in digital asset investment products, with inflows totaling $270 million last week. Interestingly, there has been a noticeable difference in the performance of various assets within the asset class. Despite the high initial volumes of options on US ETFs, there has not been a corresponding increase in ETP volumes, which stood at $22 billion last week compared to $34 billion the week before.
The US region led the way in terms of inflows, with $266 million pouring into crypto products. This was followed by Hong Kong with $39 million and Germany with $12.3 million. However, there were minor outflows in Switzerland and Canada, amounting to $26 million and $10 million respectively.
Bitcoin, the largest cryptocurrency by market capitalization, saw outflows of $457 million following its unsuccessful attempt to breach the key psychological price level of $100,000. In contrast, Ethereum set a new record for yearly inflows, attracting $634 million. This surge in inflows has pushed Ethereum’s year-to-date total to $2.2 billion, surpassing its 2021 record of $2 billion.
XRP products also saw significant inflows of $95 million, potentially fueled by speculation surrounding the possibility of an XRP exchange-traded fund (ETF) being launched in the near future.
Overall, institutional interest in the cryptocurrency market continues to grow, with investors showing confidence in the long-term potential of digital assets. As the market evolves and regulatory clarity improves, we can expect to see further growth and adoption of cryptocurrencies by institutional investors.