The recent market downturn has surprisingly led to a significant increase in investments for Ethereum. Data shows that Ethereum attracted $155 million in inflows over the past week alone. This spike in investments has pushed Ethereum’s year-to-date total inflows to an impressive $862 million, the highest since 2021. The surge in investments can be attributed to the introduction of US spot-based ETFs, which have garnered a positive sentiment towards Ethereum and other cryptocurrencies.
Bitcoin, the poster child of cryptocurrencies, also experienced a rollercoaster ride in terms of investments during the market downturn. Despite initial outflows at the start of the week, Bitcoin witnessed a significant increase in inflows towards the end, totaling $13 million for the week. However, short Bitcoin ETPs saw their largest outflows since May 2023, with a total of $16 million exiting the market, accounting for 23% of AuM. This mass exodus from short positions has brought their AuM to the lowest level of the year, signaling a major investor exit.
The positive trend in investments is not limited to Ethereum and Bitcoin alone. Investment products related to Solana, XRP, and Cardano also experienced significant inflows. Solana secured $4.5 million, XRP received $0.7 million, and Cardano saw $0.6 million in weekly inflows. The overall digital asset investment products sector witnessed a total of $176 million in inflows, showcasing investors’ willingness to capitalize on recent price declines across the board.
CoinShares’ report also shed light on the global investment landscape, revealing a surge in trading volume in Exchange-Traded Products (ETPs), which reached $19 billion for the week, surpassing the $14 billion weekly average for the year. The report also highlighted an interesting trend of inflows from every region, indicating a collective optimism towards the cryptocurrency asset class following the market dip. Notable inflows came from the US, Switzerland, Brazil, and Canada, with the US leading with $89 million in investments. Despite this positive trend, the US stands as the only country with net outflows for the month, totaling $306 million.
The recent market downturn has surprisingly fueled investments in Ethereum and other cryptocurrencies. Investors have capitalized on the price weaknesses, leading to significant inflows across the board. The resilience and growth potential of cryptocurrencies are evident in the positive sentiments and increased investments, highlighting a promising outlook for the digital asset market.
