Ethereum has experienced a significant surge in inflows amidst a recent market downturn, indicating that investors have taken advantage of the price drop to buy more of the cryptocurrency. According to data from CoinShares, Ethereum attracted $155 million in inflows over the past week, bringing its total year-to-date inflows to $862 million, the highest since 2021. This increase in inflows has been largely driven by the introduction of US spot-based ETFs.
While Ethereum has seen the most substantial inflows, other cryptocurrencies have also benefited from positive investor sentiment. Bitcoin, for example, saw a notable increase in inflows by the end of the week, totaling $13 million despite initial outflows at the beginning of the week. On the flip side, short Bitcoin ETPs experienced significant outflows, reaching $16 million, which has led to a decrease in their AuM for short positions to the lowest level of the year.
The positive trend in inflows has extended to investment products related to other cryptocurrencies as well. Solana, XRP, and Cardano all received weekly inflows, with Solana attracting $4.5 million, XRP $0.7 million, and Cardano $0.6 million. Overall, digital asset investment products collectively saw $176 million in inflows as investors saw the recent price declines as an opportunity to invest.
Despite a drop in Total Assets under Management (AuM) for these products during the market correction, it has since rebounded to $85 billion according to CoinShares’ estimates. Additionally, trading volume in Exchange-Traded Products (ETPs) surged to $19 billion for the week, surpassing the $14 billion weekly average for this year.
CoinShares also noted an interesting trend of inflows from all regions globally last week, indicating a widespread optimism towards the asset class following the recent price dip. The US, Switzerland, Brazil, and Canada saw the most significant inflows, with Germany, Australia, and Sweden also recording substantial weekly inflows. However, the US was the only country with net outflows for the month, totaling $306 million.
Overall, the increase in inflows across various cryptocurrencies and regions suggests that investors are optimistic about the future of digital assets despite the recent market downturn. This trend highlights the resilience of cryptocurrencies and their attractiveness as an investment option in uncertain market conditions.