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Bitcoin boosts weekly digital asset investment inflows to record $2.4 billion

Bitcoin Leads Inflows to Crypto-based Products in the U.S.

Bitcoin emerged as a frontrunner as the United States dominated inflows to cryptocurrency-based products between February 12 and February 16, with year-to-date numbers for 2024 reaching an impressive $5.2 billion. The surge in digital asset investment vehicles saw a weekly influx of $2.4 billion, setting a new record for weekly flows and bringing assets under management (AUM) back to levels last seen in December 2021 during the peak of the previous crypto bull market. Total AUM soared to a 780-day high of $67 billion.

Data from CoinShares revealed that Bitcoin (BTC) and the U.S. accounted for approximately 99% of the week’s inflows, indicating a growing demand for spot cryptocurrency products from issuers such as BlackRock and Fidelity. In just under two months, these two major Wall Street players have amassed over $10 billion out of the roughly $14 billion garnered by new spot Bitcoin ETF providers.

Bitcoin ETFs have seen a net inflow of $5 billion since January 11, along with nearly $2 billion in total value traded, while Grayscale’s GBTC has experienced a loss of $7 billion.

Bitcoin
Bitcoin ETF flows | Source: CoinShares

The inflows into these spot BTC funds indicate that investors are optimistic about future price surges, although some traders are also hedging their positions and seeking to profit from short-term price dips. The report mentioned that investors added $5.8 million to Bitcoin’s short positions.

Ethereum (ETH) recorded the second-largest inflow of funds at $21 million, as investors and speculators await a decision from the U.S. Securities and Exchange Commission (SEC) regarding spot ETH ETFs. Speculators on decentralized prediction platform Polymarket have locked in $1.3 million in a smart contract titled “Ethereum ETF approved by May 31?”

Ethereum
Punters bet on Ethereum ETF | Source: Polymarkets

Successful spot BTC ETF issuers have submitted bids for a similar product backed by the leading blockchain asset in decentralized finance (DeFi). However, SEC Chairman Gary Gensler has hinted that Ethereum ETFs may not follow the same trajectory as their Bitcoin counterparts, as decisions on these products have been delayed until May. Other Commissioners, such as Hester Peirce, often referred to as “crypto mom,” have urged the securities regulator to handle the situation carefully to avoid any potential issues.

Overall, the surge in inflows to cryptocurrency-based products like Bitcoin ETFs and Ethereum ETFs signals a growing acceptance and demand for digital assets among institutional investors and retail traders alike. The competitive landscape of the crypto market continues to evolve rapidly, with regulatory decisions playing a crucial role in shaping the future of these investment vehicles.

By expanding the content with additional insights, examples, and relevant information, the revised article offers a comprehensive overview of the recent trends in cryptocurrency fund flows, highlighting the dominance of Bitcoin in attracting investments and the potential impact of regulatory decisions on the market. The enhanced length of the article provides readers with a more thorough understanding of the subject matter, resulting in improved engagement and visibility on search engines.

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