Latest weekly a report CoinShares, a prominent European digital asset investment firm, reveals notable shifts in crypto asset fund flows. The report highlights $48 million worth of inflows into digital asset investment products over the past week.
However, the overall picture appears more complex, reflecting the influence of macroeconomic factors and investor sentiment on fund flows.
James Butterville, head of research at CoinShares, noted that although nearly $1 billion flowed into digital asset products during the first half of the week, the release of new macroeconomic data and US Federal Reserve meeting minutes led to significant outflows of $940 million in the “last half.”
Butterfly wrote:
The release of new macroeconomic data and US Federal Reserve meeting minutes – which pointed to a stronger US economy and a more hawkish Fed – led to outflows of $940 million in the last half. This indicates that the post-US election honeymoon is over, and that macroeconomic data is once again becoming a major driver of asset prices.
Bitcoin leads inflows while Ethereum faces outflows
According to a CoinShares report, Bitcoin maintained its dominance in money flows last week, attracting $214 million. Despite experiencing outflows later in the period, Bitcoin remains the “best-performing asset” year-to-date, with cumulative inflows of $799 million.
This performance highlights its continued appeal for investors seeking exposure to digital assets amid broader market volatility. In contrast, Ethereum faced significant pressure, recording outflows of $256 million.
Butterville attributed this trend to a widespread sell-off in the technology sector rather than any specific issues with the Ethereum network itself. Meanwhile, Solana stood out as a positive exception, attracting inflows worth $15 million, indicating resilience in some altcoin sectors even under difficult market conditions.
Overall, altcoins have shown mixed but generally positive trends despite disappointing price performance. Aave, Stellar, and Polkadot saw inflows of $2.9 million, $2.7 million, and $1.6 million, respectively, indicating continued investor interest in these projects.
This trend reflects the increasing diversity in investment strategies as altcoins continue to attract niche markets and developers. XRP recorded $41 million in inflows, with Butterfill linking this activity to ongoing political and legal developments. Head of Research at CoinShares noted:
XRP saw significant inflows of US$41 million last week and continues to be driven primarily by political and legal factors, with the inflows indicating growing optimism ahead of the SEC’s January 15 appeal deadline.
Global crypto market forecast
The global cryptocurrency market faced notable bearish sentiment over the past week, losing nearly $400 million in total market capitalization. In particular, the valuation fell from $3.662 trillion last Monday to $3.283 trillion as of today.
This significant decline in market capitalization can mainly be attributed to the ongoing downward trend in Bitcoin. At the time of writing, Bitcoin has now fallen below $91,000 with a trading price of $90,704, representing a 3.9% decline in the past day.
Featured image created with DALL-E, chart from TradingView
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