Research Summary
The report discusses the recent trends in digital asset fund flows, highlighting the performance of Bitcoin, Ethereum, Solana, and blockchain equities. It also provides insights into the performance of newly issued ETFs in the US and the migration of assets to the US due to competitive fees.
Key Takeaways
Performance of Digital Asset Investment Products
- Minor Outflows: Digital asset investment products experienced minor outflows last week, totaling US$21m. However, this figure is overshadowed by the high trading volumes, which reached US$11.8bn.
- Bitcoin’s Trading Dominance: Bitcoin’s trading volumes accounted for 63% of all Bitcoin volumes on trusted exchanges, indicating that ETP activity is currently dominating overall trading activity.
US ETFs and Incumbent Issuers
- US ETFs Attracting Inflows: Newly issued ETFs in the US have seen a total of US$4.13bn inflows since their launch, while incumbent, higher-cost issuers have seen US$2.9bn of outflows.
- Asset Migration to the US: The US saw US$263m of inflows, while Canada and Europe combined saw US$297m outflows, suggesting a minor migration of assets to the US where fees are more competitive.
Performance of Altcoins
- Altcoins Suffering: Altcoins such as Ethereum and Solana experienced outflows of US$14m and US$8.5m respectively.
Blockchain Equities
- Continued Inflows into Blockchain Equities: Blockchain equities saw further large inflows totaling US$156m, bringing the last 9 week run to US$767m.
Actionable Insights
- Monitor the Performance of Newly Issued ETFs: The newly issued ETFs in the US have attracted significant inflows since their launch, outperforming incumbent issuers. This trend could indicate a shift in investor preference towards lower-cost options.
- Assess the Impact of Competitive Fees: The migration of assets to the US, where fees are currently more competitive, suggests that fee structures could significantly influence investment decisions in the digital asset space.
- Track Altcoin Performance: The outflows from altcoins such as Ethereum and Solana could signal a potential shift in investor sentiment towards these digital assets.
- Consider the Momentum of Blockchain Equities: The continued inflows into blockchain equities over the past 9 weeks indicate sustained investor interest in this sector.
