Crypto Investments Record Largest Inflow in a Month
27 Aug, 2024 ● Crypto News
Cryptocurrency investors have increasingly been purchasing Bitcoin-related exchange-traded products (ETPs) due to concerns about potential interest rate cuts in September.
According to a report from crypto investment firm CoinShares on August 26, digital asset investment products experienced weekly inflows totaling $533 million from August 18 to August 24.
This recent surge in purchases of crypto-related ETFs marks the largest inflows in the past five weeks, driven by expectations of interest rate cuts in the United States.
On August 21, US Federal Reserve Chair Jerome Powell hinted that the first interest rate cuts could happen in September 2024.
Among the various crypto investment products analyzed by CoinShares, Bitcoin-related ETPs received the highest inflows last week, amounting to $543 million.
The most significant inflows came from BlackRock's iShares Bitcoin Trust (IBIT), which saw $318 million in inflows during the week.
In contrast, Ethereum-related crypto investment products experienced outflows, with $36 million leaving these products over the same period.
Despite new ETH ETF issuers seeing some inflows, the Grayscale Ethereum Trust (ETHE) offset this by recording $118 million in outflows.
Despite significant outflows from the Grayscale Ethereum Trust, new Ethereum ETFs have attracted $3.1 billion in inflows since their launch on July 23.
However, these inflows were partly counterbalanced by the $2.5 billion outflow from Grayscale’s ETHE during the same period.
Amid these increasing inflows, Bitcoin's price saw notable growth, with BTC gaining about 8% in value, rising from $59,500 on August 18 to $64,300 on August 24.
However, the cryptocurrency is still down approximately 6% over the past 30 days, having reached a price of $69,900 on July 29, according to data from CoinGecko.
While crypto inflows surpassed $500 million for the first time in five weeks, they did not break historical records.
The largest inflow spike in 2024 occurred between March 11 and March 17, soon after Bitcoin's price hit its historical high of $73,600 on March 14.
An analysis by the crypto financial services platform Matrixport suggests that one of the main drivers behind the recent Bitcoin surge is the active minting of new stablecoins like Tether.
“Robust stablecoin minting is the main force behind Bitcoin rise, suggesting institutional influence surpasses macroeconomic factors,” Matrixport stated in its latest update on August 26.
Sources:
https://cointelegraph.com/news/crypto-investment-largest-inflows-5-weeks
https://etp.coinshares.com/knowledge/market-activity/fund-flows-26-08-24
