Bitcoin Funds Dominate as Digital Asset Market Surges: CoinShares Report
The ETF Effect: Digital Assets Surpass the 1 Billion Dollar Mark
The world of digital assets has seen a significant influx in the past week. According to the latest report from digital asset management firm CoinShares, investments exceeding one billion dollars have reached the cryptocurrency market. This represents an increase of 55% compared to the previous week.
Bitcoin Dominates the Inflows
Funds tied to Bitcoin [BTC] attracted nearly 98% of total inflows in the past week. This brought the inflows since the beginning of the year to 2.5 billion dollars. Much of the activity was focused on the approximately twelve Bitcoin spot ETFs in the US, which received regulatory approval last month. Since their introduction, these newly issued ETFs have received inflows of 2.8 billion dollars.
Decline in Outflows from the Grayscale Bitcoin Trust
Outflows from the Grayscale Bitcoin Trust (GBTC), which was converted into a spot ETF, have decreased. This is supported by data from SoSo Value. Daily outflows from the fund have dropped by 92% since their peak on January 22.
Potential Market Risks
Despite the positive development, the report warns of the possible liquidation of 1.6 billion dollars from the insolvent crypto lender Genesis Global. Such an event could exert significant downward pressure on the market.
Inflows Also in Other Crypto Products
Funds tied to other major cryptocurrencies such as Ethereum [ETH] and Cardano [ADA] also saw considerable inflows, with 16 million dollars and 6 million dollars respectively. This increase in investments followed an impressive price increase in the coins. Both recorded gains of 6.8% in the past seven days, according to CoinMarketCap.
Sources: CoinShares, SoSo Value, CoinMarketCap
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