Digital Assets Rally Leaves Investors Polarized

The sentiment for the U.S. was bearish last week, while for Europe it was bullish.

JamesButterfill310x310
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Head of Research and Investment Strategy
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Reviewed by: James Butterfill
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Edited by: James Butterfill

Takeaways

  • Digital asset investment products saw US$37m inflows last week, although this was predominantly into short investment products (68%).
  • Regionally, opinion is very polarised. Inflows were seen in Europe, most notably Germany and Switzerland with US$14m and US$10m respectively.
  • Hong Kong saw outflows from long investment products, while the 95% of the inflows into the US were into short-Bitcoin products.

 

 

Digital asset investment products saw US$37m inflows last week, although this was predominantly into short investment products (68%). Trading activity for the week was high at US$1.6bn, above the 90-day average. of US$990m, with 80% of the trading focussed on Bitcoin. Total assets under management after recent price appreciation is now at US$29bn, the highest since September 2022.

Regionally, opinion is very polarised. Inflows were seen in Europe, most notably Germany and Switzerland with US$14m and US$10m respectively. Outflows were seen in European short investment products too, suggesting sentiment is positive. In contrast, Hong Kong saw outflows from long investment products (US$11m), while the 95% of the inflows into the US were into short-Bitcoin products.

Bitcoin saw inflows totalling US$5.7m last week, while short-bitcoin investment products saw inflows totalling US$25.5m, the largest weekly inflow since July 2022 (US$51m).

In contrast to Bitcoin, a large number of altcoins saw inflows, most notable of which were Ethereum, Polkadot, Cardano, XRP and Avalanche with US$4.2m, US$1.0m, US$0.6m, US$0.6m and US$0.5m respectively.

Blockchain equities also saw inflows totalling US$7.1m last week.

 

 

 

 

 

 

Contact James Butterfill at [email protected]

James Butterfill has over 19 years of experience in fund management, investment banking, economics and asset allocation, gained most recently as an investment strategist at CoinShares. Previously, he was head of research at ETF Securities, with prior experience as a multi-asset fund manager and investment strategist at Coutts & Co., HSBC & ING Barings. James is a regular media commentator, and frequently appears on Bloomberg TV, CNBC, BBC and other broadcast outlets. Investment Week awarded him best ETF Eesearch and best FX Research in 2016 and 2017, respectively. James is currently an investment strategist at CoinShares, writing research white papers on investment themes, identifying investment opportunities and helping investors understand the digital asset world.