Ethereum Records $296M Inflow as Digital Asset Funds Extend Streak to 7 Weeks

Digital asset investment funds continued to draw attention, recording their seventh consecutive week of inflows. Data from CoinShares shows that crypto ETPs saw a net inflow of $224 million, pushing the seven-week total to an impressive $11 billion.

Irrespective of the inflow, James Butterfill, Head of Digital Asset Research at CoinShares, highlighted a noticeable slowdown in the market, stating that this is a result of market participants adopting a wait-and-see approach.

Interestingly, Butterfill revealed that participants await clearer signals from the U.S. Federal Reserve on inflation and monetary policy. This cautious sentiment has shaped a mixed landscape, with regional inflows and standout performances from certain assets stealing the spotlight.

Ethereum Leads with Stellar $296.4 Million Inflow

Red-hot Ethereum has again emerged as the star of the week, dominating ETP inflows for two consecutive weeks. Notably, the altcoin king recorded a strong $296.4 million in inflows, which marked its strongest run since the U.S. election in November last year. 

Over the past seven weeks, Ethereum has attracted $1.5 billion, now representing 10.5% of total assets under management (AuM). This surge reflects a significant recovery in investor sentiment, likely fueled by recent developments such as the Pectra upgrade in May, which has bolstered institutional interest. 

Notably, asset manager BlackRock led the inflow with $330 million last week, followed by Bitwise Funds Trust and 21Shares AG, which recorded inflows of $13 million and $2 million, respectively. Meanwhile, Grayscale Investment, Fidelity, ARK 21Shares, ProShares ETF, and CoinShares XBT collectively experienced outflows of $230 million. 

Nonetheless, digital asset flows have not reached the levels seen in previous weeks, as reluctance kicks in, mainly due to the ambiguity of U.S. Federal Reserve policy. Despite the slowdown, Ethereum’s strength offers a bright spot, suggesting a potential reallocation of focus within the digital asset space as the year progresses.

Bitcoin Leads Outflows 

In contrast to Ethereum, Bitcoin recorded a $56 million outflow. Products tracking the performance of the cryptocurrency firstborn faced a second consecutive week of outflows, totaling $64 million, as policy uncertainty kept investors on the sidelines. 

Short-bitcoin products also mirrored this trend, experiencing a total of $7.7 million in outflows for the second week. Meanwhile, investment products for other altcoins saw mixed reactions. 

For perspective, investors dumped $2.1 million and $4 million from Solana and XRP, while Sui and ChainLink saw inflows of $1.1 million and $200,000, respectively. 

Regional Flows

Regionally, the United States led the inflows into crypto ETPs, registering $175 million in the past week. This marked a 12% decrease from the previous week’s inflow of $199 million. 

Germany emerged second on the list, recording an inflow of $47.8 million, marking an impressive 11% increase from its previous week’s inflow of $42.9 million. Other countries, such as  Switzerland, Canada, and Australia, also saw substantial inflows of $15.7 million, $9.8 million, and $6.5 million, respectively. 

Meanwhile,  crypto investment products in Brazil ($9.2 million) and Hong Kong ($14.6 million) recorded outflows, with the latter ending a streak of record inflows.