News & Analyses

Digital asset funds record weekly inflows for first time in five weeks

  • Investment across digital asset products recorded inflows of $130 million last week.
  • Hong Kong ETFs record weak inflows after a prior record-breaking week.
  • The volume of ETPs continues to decrease, recording only $8 billion, less than 50% of the average in April.

CoinShares’ weekly digital assets fund flows report on Monday shows that crypto assets have broken a five-week streak of outflows with a $130 million gain. These inflows have largely been triggered by the performance of US Bitcoin ETFs, while Hong Kong ETFs continue to underperform investors’ expectations.

Also read: Crypto investment products post outflows for fourth straight week despite ETFs debut in Hong Kong

Digital assets products record inflows

According to CoinShares, digital assets investment products witnessed inflows for the first time in five weeks with a net positive of $130 million. Considering the dominance of the US Bitcoin ETFs, their flows have been responsible for a large portion of the total digital asset product flows.

For example, after beginning the month poorly, Bitcoin recorded $144 million in inflows last week — more than the total net inflow of digital assets products. Outflows in the past weeks were majorly from Bitcoin ETFs.

Despite the inflows, digital asset exchange-traded products (ETPS) trading volume has decreased significantly compared to April’s volumes. Last week, ETPs volume was $8 billion, less than half of the average volume of $17 billion seen in April.

“These volumes highlight ETP investors are participating less in the crypto ecosystem at present, representing 22% of total volumes on global trusted exchanges relative to 31% last month,” said CoinShares.

The decline may be due to doubts surrounding the approval of spot ETH ETFs, considering the low interaction of regulators with applications from issuers. If approved, spot ETH ETFs would bring increased inflows to digital assets. However, the market is already acting based on expectations of a potential spot ETH ETF denial.

Also read: Ethereum sustains horizontal trend, sees increased outflows

Meanwhile, Hong Kong ETFs saw only $19 million in inflows “after a prior week of record inflows,” stated CoinShares. Compared to investors’ expectations, Hong Kong Bitcoin and Ethereum ETFs have underperformed as they’ve shown little impact in the general market. Canada and Germany, on the other hand, maintained recording outflows, reaching $20 million and $15 million, respectively.

Additionally, Solana investment products recorded nearly $6 million in inflows.

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