Cryptocurrency funds received over $75 million in investment last week. This was the fourth consecutive week with net inflows into the market, demonstrating a continual and growing confidence in profit builder and other altcoins. This comes as a relief as prices showed an upward trend after January’s slowdown.
Bitcoin’s price fell 17% last month. It has so far recorded over 20% growth this month. Besides other coins, Ethereum funds also experienced their first inflows in almost 10 weeks, receiving around $21 million. These inflows are relatively smaller compared to the ones recorded during Q4 2021.
All this could be an indication that the crypto market is eventually on its path to recovery after a significant decline during the New Year period.
Inconsistent Regional Fund Flows
It was found that there were significant differences between the funds flowing in and out of different regions during the week. For example, the European investment products recorded inflows of $80.7 million while the Americas recorded outflows of $5.5. million.
Ether (ETH) fell 5.9% during the past week and was trading around the $3,000 mark. This was before it gained 16% the week before. Bitcoin received around $25 million in funds.
Ethereum’s Recovery
As already mentioned, Ethereum received $21 million in investment from institutional entities during the week, which helped it put to end a 9-week spree of outflows. The altcoin has been undergoing a steady decline in price and investment inflows since the middle of December last year.
During these 9 weeks, the second-largest digital currency lost almost $280 million through outflows. Some of the key facts of this recovery are as follows:
- Ethereum received $20.9 million in the form of investment product inflows
- The entire cryptocurrency market received $75.3 million in inflows
- Bitcoin led the race, as it received $25.1 million in inflows, which was 28% of the overall inflow into crypto solutions during the week.
- At the end of the last week, Ethereum’s overall assets under management or AuM rose to $13.055 billion.
- Solana received $3.1 million in inflows while Ripple recorded $2 million
- Multi-asset investment products received $18.7 million
- Terra, Cosmos, and Tezos are recently created digital currencies and saw some minor but interesting inflows. Terra received $2.2 million, while Cosmos and Tezos saw inflows of $0.6 million and $0.9 million respectively.
Blockchain equity investment products experienced the largest investments since the end of 2021, recording a total of $69 million.
A funds-based breakdown revealed ProShares receiving the largest inflow in the form of $45 million. Purpose recorded a major outflow amounting to $75 million. Grayscale maintained a flat position in asset flows, holding onto $37 billion in AuM. Grayscale is the largest crypto asset fund manager in the world.
Bitcoin AuM
Bitcoin’s AuM crossed $36 billion during the week. While this figure is higher than the prior week, it is nowhere near the peak of $50 billion in November last year. The value of Bitcoin AuM fell in line with its price.
Since its peak of over $69,000 in November 2021, BTC has recorded an almost 40% decline in value. While it has recovered almost 20% of its value this month, it is still priced at around $44,000.
Bitcoin Network’s Has rate Peaks
As BTC recovers, data has shown that its network computing power recorded an all-time high during the weekend. This is due to the surge in inflows into Ethereum funds.
Bitcoin’s hash rate touched a peak of 248.11 million tera hashes per second during the weekend. Even when the hash rate is not directly related to Bitcoin’s price, it has increased dramatically along with the BTC price over the past 2 years. A higher BTC hash rate is a sign of increased Bitcoin mining activity for securing the BTC network and earning fresh-minted coins.
Overall, the data indicates that institutional investors are more confident in Ethereum for some time. The surge in confidence breaks a 2-month long period of outflows. These developments can also be seen as a reassurance that more investors now see value in adding Ethereum into their portfolio. At the same time, it is worth exploring how long this recovery will last. With some major economies passing or proposing laws to regulate cryptocurrencies around the world and BlackRock, the world’s largest asset manager, expected to enter the market, the crypto landscape has some major positive cues for the near future.
