Crypto: $2 billion in inflows in one week

Crypto investment products recorded inflows of $2 billion last week, amid expectations of lower interest rates: CoinShares. Asset managers such as Ark Invest, Bitwise, BlackRock, Fidelity, Grayscale, ProShares, and 21Shares reported net inflows totaling $2 billion during the first week of June, marking the fifth consecutive week of positive inflows. CoinShares’ latest report highlights this exceptional performance.

An impressive performance

Last week’s net inflows into crypto funds equaled those of the entire month of May, bringing the five-week series to a total of $4.3 billion.

Assets under management surpassed the billion-dollar mark for the first time since March. Trading volume also increased, generating $12.8 billion, which is 55% more than the previous week. 

James Butterfill, head of research at CoinShares, highlighted that unusual inflows were observed across nearly every provider, while outflows at historical operators slowed.

This shift in sentiment appears to be a direct response to weaker-than-expected macroeconomic data in the United States, reinforcing expectations of monetary policy rate cuts.

The U.S. market accounted for $1.98 billion of last week’s net inflows, as part of a series of records for spot Bitcoin, which now spans 19 trading days and over $4 billion. 

BlackRock’s spot Bitcoin ETF reported nearly $1 billion in inflows just last week, surpassing 300,000 BTC in assets under management. This fund now has over $21 billion in assets, exceeding the assets under management of Grayscale’s GBTC-converted fund from the previous week.

The continued dominance of Bitcoin and the rise of ETH crypto

The U.S. spot Bitcoin ETF generated $1.8 billion in net inflows last week, with Bitcoin investment products adding $1.97 billion globally. 

To put this in perspective, the funds absorbed more than two months’ worth of new bitcoin mining resources, maintaining an average of 450 BTC per day in a single week.

Nate Geraci, president of the ETF Store, commented on this situation, highlighting how remarkable this performance is for a product many believed to be unpopular. Today, the ETF category represents $60 billion in just five months.

In response to questions about the stability of bitcoin prices despite significant net inflows, Eric Balchunas, ETF analyst at Bloomberg, explained on X that the action is mainly coming from bitcoin holders selling rather than ETFs buying massively. This creates a dynamic where bitcoin holders take advantage of price rises to sell, while ETFs continue to absorb the available volumes.

Meanwhile, investment products based on Ethereum had their best week of net inflows since March, adding $69 million. This performance is likely a reaction to the SEC’s surprise decision to allow spot Ethereum ETFs in the United States.