Last week, the total inflows into crypto investment products surpassed $1 billion, a significant increase compared to the previous week. This growth was driven by the launch of 10 spot Bitcoin ETFs, making it more than five times higher than the previous week’s inflows.
According to a recent report by CoinShares, the total global inflows into exchange-traded products (ETPs) reached $1.18 billion, with the United States contributing a net of $1.24 billion to the crypto economy. However, minor outflows from Europe offset these gains.
Although these figures are impressive, they do not break any records. In October 2021, the crypto sector saw a record $1.5 billion in inflows in a single week, thanks to the launch of Bitcoin futures ETFs. Unlike spot ETFs, which were introduced last week and involve the actual buying and storing of Bitcoin, futures ETFs track the price of derivatives contracts.
However, last week did set a different record, with net trading volume for crypto industry ETFs exceeding $17.5 billion, the highest ever recorded in a seven-day period. This was largely due to the massive trading volume of $4.5 billion on the first day of the Bitcoin ETFs’ launch. The difference between this figure and net inflows is a result of assets being transferred to the new ETFs and Grayscale’s transition of its Bitcoin Trust to an ETF.
On the other hand, the Grayscale Bitcoin ETF saw significant outflows, likely due to its relatively higher fee compared to other ETFs. This was reflected in the product’s trading volume last week.
However, analysts have cautioned against putting too much emphasis on the initial performance of these financial products, as they are typically viewed and approached with a long-term perspective by Wall Street investors.
In summary, the launch of 10 spot Bitcoin ETFs last week resulted in impressive inflows of over $1 billion into crypto investment products. However, this did not break any records and should be viewed with caution, as ETFs are typically seen as long-term investments.
