Home Crypto News Political Shift Drove Nearly $500 Million to Crypto

Political Shift Drove Nearly $500 Million to Crypto

14 Oct, 2024 Crypto News

Political Shift Drove Nearly $500 Million to Crypto

Cryptocurrency investment products had another strong week, with Bitcoin leading the charge by attracting $419 million in inflows.

From Oct. 5 to Oct. 11, digital asset investment products recorded $407 million in inflows, according to CoinShares' latest Digital Asset Fund Flows Weekly Report, released on Oct. 14.

These new inflows came after a minor sell-off of $127 million the previous week, which occurred amid stronger-than-expected economic data from the United States.

James Butterfill, CoinShares' head of research, suggested that the recent rise in crypto investment products was likely driven by the upcoming U.S. elections rather than shifts in monetary policy.

“This trend is evident in the fact that stronger-than-expected economic data had little impact on stemming outflows,” Butterfill explained, adding that other factors, such as "polling toward the Republicans," provided an "immediate boost in inflows and prices."

He further mentioned that Republicans are generally seen as "more supportive of digital assets."

On Oct. 10, major news outlets, including The New York Times, reported new polls indicating that control of the U.S. Senate could shift from the Democratic Party to the Republican Party after the Nov. 5 elections.

This election will decide the next U.S. president, with Republican candidate and former President Donald Trump facing off against Democratic candidate, Vice President Kamala Harris.

Bitcoin was the “primary beneficiary” of these political shifts, receiving $419 million in inflows, according to Butterfill. In contrast, short-Bitcoin investment products experienced outflows of $6.3 million.

Blockchain equity exchange-traded funds (ETFs) also had a significant week, with $34 million in inflows, one of the largest weekly totals in 2024 so far.

Butterfill attributed this growth to Bitcoin’s price increase, which rose over 2%, from $61,900 on Oct. 6 to around $63,300 by Oct. 12.

Multi-asset investment products saw modest inflows of $1.5 million, marking the 17th consecutive week of inflows for the category.

Ethereum, however, continued to experience outflows, with investors pulling $9.8 million from Ether products last week.

These latest inflows are part of a larger trend that started in mid-September. CoinShares reported that nearly $2 billion was added to crypto investment products between Sept. 7 and Sept. 28.

Sources:

https://cointelegraph.com/news/political-shift-407-million-inflow-crypto-coinshares

https://blog.coinshares.com/volume-204-digital-asset-fund-flows-weekly-report-b41f0790a1f3

https://www.nytimes.com/2024/10/10/us/politics/senate-polls-montana-florida-texas.html

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