Crypto Funds Experience Record $30 Billion Trading Volume, Led by Bitcoin Dominance
The majority of these inflows, amounting to $1.72 billion, flowed into bitcoin investment products, and investor's confidence in the leading cryptocurrency continued.
Last week, global digital-asset investment products achieved an unprecedented trading volume of $30 billion, marking a significant milestone in the cryptocurrency market, according to CoinShares. The surge in trading activity was driven by a variety of investment products offered by asset managers like Ark Invest, Bitwise, BlackRock, Fidelity, Grayscale, ProShares, and 21Shares, with U.S. spot bitcoin exchange-traded funds (ETFs) taking the lead.
James Butterfill, Head of Research at CoinShares, noted that trading volumes in investment products surpassed $30 billion for the week, at times representing up to 50% of global daily bitcoin trading volumes on reputable exchanges. Notably, U.S. spot bitcoin ETFs accounted for a substantial portion of this activity,
In addition to the remarkable trading volume, crypto funds also experienced their second-largest weekly net inflows on record, totaling $1.84 billion. The majority of these inflows, amounting to $1.72 billion, flowed into bitcoin investment products, and investor's confidence in the leading cryptocurrency continued. U.S.-based funds, in particular, saw significant net inflows of $1.88 billion for the week, despite some outflows from Grayscale's higher fee fund.
While bitcoin investment products attracted substantial inflows, short investors doubled down with an additional $22 million flowing into short-bitcoin investment products. This occurred as the price of Bitcoin surged by more than 20%, reaching $65,024 at the time of reporting.
Regionally, Switzerland-based funds saw notable inflows of $20 million, while Germany, Sweden, and Canada experienced outflows. Total assets under management (AUM) in the cryptocurrency market are now nearing an all-time high of $82.6 billion, closely approaching the peak set in early November 2021.
In addition to bitcoin, other cryptocurrencies also saw significant movement in investment products. Ether-based products witnessed their largest weekly inflows since July 2022, adding $85 million to their AUM. Meanwhile, Polygon-based funds saw inflows of $7.6 million, while Solana products registered outflows of $12 million for the third consecutive week.
The surge in trading volume and net inflows will grow interest and confidence in cryptocurrency investment products, particularly in the midst of market volatility and regulatory developments.
