Digital asset investment products showed positive inflows last week, but gains were mainly concentrated in Bitcoin (BTC) funds, suggesting that institutional investors are more cautious about cryptocurrency allocation.
Cumulative inflows into bitcoin investment products totaled $126 million for the week ended Saturday, according to CoinShares’ latest money flows report. Year-to-date, bitcoin investment funds have quietly seen net inflows of $506 million.
Investors appear to be allocating to Bitcoin at the expense of Ethereum (ETH) and other altcoins. Ethereum funds saw $32 million in outflows, the ninth straight week of losses. This year, outflows from Ethereum investment products totaled $357.4 million.
Meanwhile, investments in multi-asset crypto funds increased by $4.3 million last week, bringing the year-to-date total to $201.3 million.
Grayscale remains the largest single digital asset manager with over $27 billion in assets under management. Approximately 99% of Grayscale's total assets are held in the Grayscale Bitcoin Trust, also known as GBTC.
Unable to escape the gravitational pull of traditional financial markets, crypto assets have been in a long-term downtrend for most of 2022. The price of Bitcoin has suffered a nine-week losing streak, the longest such decline in history, as investors entered a prolonged period of "extreme fear" on the Bitcoin Fear and Greed Index.
June 6, last week and last month: Bitcoin's Fear & Greed Index has been in a state of extreme fear
Bitcoin closed at $29,900 on Sunday, narrowly avoiding its 10th straight weekly decline, just $450 higher than the previous week.
Still, there are some positive signs that institutional investors are buying the dip. In addition to the CoinShares report, a Canadian spot bitcoin exchange-traded fund run by Purpose Investments bought thousands of bitcoins last month. By May 13, Bitcoin holdings in the Purpose Bitcoin ETF hit a record high of 41,600 BTC.
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