According to the latest report from CoinShares, inflows into cryptocurrency investment products recovered last week, with $436 million in net inflows led by Bitcoin.
After two consecutive weeks of withdrawals, crypto funds at asset managers such as BlackRock, Bitwise, Fidelity, Grayscale, ProShares, and 21Shares recorded positive inflows in the week ending September 13. CoinShares believes this can be explained by market expectations of a rate cut by the US Federal Reserve.
In the latest “Weekly Digital Asset Fund Flows Report,” CoinShares head of research James Butterfill wrote:
“We believe the surge in net inflows over the weekend was driven by a significant shift in market expectations for a possible 50 basis point rate cut on September 18.”
Source: CoinShares
However, Butterfill added that volume in crypto investment products remained flat at $8 billion for the week, well below the 2024 Medium of $14.2 billion.
Bitcoin Investment Products Dominate as Ethereum Struggles
Bitcoin (BTC) investment products led the reversal, recording $436 million in inflows, after experiencing 10 straight days of withdrawals totaling $1.8 billion, according to CoinShares.
Net inflows from short-term Bitcoin investment products also reversed, recording net outflows of $8.5 million after three consecutive weeks of inflows.
Cryptocurrency investment product flows by asset. Source: CoinShares
Solana (SOL) investment products also saw net inflows of $3.8 million last week — the fourth consecutive week. Litecoin (LTC) and Cardano (ADA) also saw total inflows of $300,000 and $600,000, respectively.
However, Ether (ETH) continued to struggle, experiencing a net outflow of $19 million in the week of September 9-13, adding to the previous week’s $98 million negative outflow. CoinShares believes this is due to concerns about the profitability of layer-1 blockchains following the Dencun upgrade.
Some traders believe that the significant inflows into Bitcoin spot ETFs since their market launch on January 11 compared to Ether ETFs experiencing net outflows have shifted investor preference towards Bitcoin.
This sent the ETH/ BTC ratio falling below $0.04, its lowest level since April 2021.
ETH/ BTC weekly chart. Source: TradingView
Since the wave of spot Ether ETFs launched on July 23, these ETFs have seen net outflows of $581 million. In contrast, spot Bitcoin ETFs saw over $12 billion in inflows in their first two months and have seen over $17 billion in net inflows in just over eight months of trading.
Ethereum ETF Spot Cumulative Flows. Source: Farside Investors
