Digital Asset Investment Fund Flow Sees Over $600 Million

Crypto Funds

The recent outflows and price sell-off resulted in total assets under management (AuM) dropping from over $100 billion to $94 billion during the week

Digital asset investment products have attracted over $600 million in new capital, the largest since March 22, 2024. The inflow is likely due to a more hawkish-than-expected FOMC meeting, which reduced investors’ exposure to fixed-supply assets. 

The recent outflows and price sell-off resulted in total assets under management (AuM) dropping from over US$100 billion to $94 billion within the week. 

Trading volumes for the week were $11 billion, below this year’s weekly average of $22 billion but significantly higher than the $2 billion per week observed last year. Despite the performance, digital asset ETPs continue to account for a steady 31% of global trading volumes on trusted exchanges.  

U.S. Experienced Major Outflows

Furthermore, the US experienced the most outflows, totaling US$565 million. However, the negative sentiment extended beyond the US, with Canada, Switzerland, and Sweden seeing outflows of $15 million, $24 million, and $15 million, respectively. In contrast, Germany resisted the trend, recording inflows of $17 million.   

The outflows were concentrated completely on Bitcoin, which saw $621 million in withdrawals. The bearish sentiment also led and contributed to $1.8 million in inflows into short-bitcoin positions.  

Interestingly, a diverse range of altcoins experienced inflows, with Ethereum leading the way at $13 million, followed by LIDO and XRP, which received $2 million and $1 million, respectively.     

Digital Asset Investment Inflows  

On February 12, 2024, digital asset investment products recorded inflows of $1.1 billion, increasing year-to-date inflows to $2.7 billion, which brings assets under management (AuM) to $59 billion, the highest level since early 2022.   

Regionally, attention remained on newly issued spot-based Bitcoin ETFs in the US, which garnered net inflows of $1.1 billion last week, which brings total inflows since the January 11th launch to $2.8 billion.  

Bitcoin accounted for nearly 98% of the inflows, with the price appreciation also raising sentiment for Ethereum and Cardano. 

While Bitcoin and Ethereum maintain dominance, there is a noticeable trend towards diversification into altcoins. Digital assets like Solana, Cardano, and Polkadot are gaining momentum among investors who seek to leverage their distinct value propositions and potential for significant returns.  

In May, 2024, digital asset investment products experienced their fourth consecutive week of inflows, totaling $185 million, which increased May’s total inflows to $2 billion, pushing year-to-date inflows to over $15 billion.