Research Summary
The report discusses the recent trends in digital asset fund flows, highlighting the significant inflows into Bitcoin and new US ETFs, and the slowing outflows from Grayscale. It also notes the performance of other digital assets like Solana, Ethereum, and Avalanche, and the trading volumes in ETPs.
Key Takeaways
Strong Inflows into Digital Assets
- Significant Inflows: Digital asset investment products experienced substantial inflows of US$708m in the past week, bringing the year-to-date inflows to US$1.6bn and total global assets under management to US$53bn.
Bitcoin Dominates the Inflows
- Bitcoin’s Dominance: Bitcoin saw inflows totalling US$703m last week, accounting for 99% of all flows. This coincided with a reversal of negative price momentum.
US ETFs Attracting Investments
- US ETFs’ Performance: New US ETFs have averaged US$1.9bn inflows over the last 4 weeks, bringing total inflows since their launch on 11th January to US$7.7bn. However, this has been offset by outflows from incumbent issuers, totalling US$6bn.
Outflows from Grayscale Slowing Down
- Grayscale’s Outflows: While there have been outflows from incumbent issuers, the report highlights a significant reduction in the momentum of these outflows in recent weeks.
Performance of Other Digital Assets
- Other Digital Assets: Solana outpaced Ethereum and Avalanche with US$13m inflows last week, while Ethereum and Avalanche saw outflows of US$6.4m and US$1.3m respectively.
Actionable Insights
- Monitor Bitcoin’s Performance: Given the significant inflows into Bitcoin, it would be prudent to keep a close eye on its performance and market trends.
- Assess the Impact of US ETFs: The new US ETFs have attracted substantial inflows since their launch. Understanding their impact on the digital asset market could provide valuable insights.
- Track Outflows from Grayscale: The slowing down of outflows from Grayscale could indicate a potential shift in investor sentiment. Monitoring this trend could be beneficial.
- Watch Other Digital Assets: Solana’s performance, in particular, and the outflows from Ethereum and Avalanche, could signal changing dynamics in the digital asset market. Keeping track of these trends could be insightful.
