Crypto investment product net inflows see $130m rebound

Weekly digital asset trading products broke a five-week streak of outflows as crypto traders in the U.S. and Hong Kong used more capital than withdrawals.

According to CoinShares, $130 million has flowed into these crypto instruments, with the US taking the lion’s share last week. Decreasing Grayscale outflows slowed activity in the region as GBTC recorded its lowest weekly withdrawal in five months at $171 million.

Hong Kong Bitcoin (BTC) ETFs drew $19 million in inflows, but some pale in comparison to Wall Street offerings that brought in $135 million across 11 products. Analysts noted that ETF volume of $8 billion has been trending downward since last month’s weekly average of $17 billion.

“These volumes indicate that ETP investors are currently less participating in the crypto ecosystem, representing 22% of total volumes on global trusted exchanges compared to 31% last month.”

CoinShares report

Even though market prices declined, Bitcoin sentiment turned into inflows. The same cannot be said for crypto’s second-largest asset class, Ethereum (ETH), as researchers note further outflows of $14 million.

CoinShares analyst James Butterfill wrote that ETH outflows are likely linked to U.S. regulatory activity around spot Ethereum ETFs. Doubts have grown that approvals will eventually come as the SEC has delayed decisions on the matter.

Enforcement action against Ethereum-adjacent entities like Consensys, Uniswap, and crypto operators like Robinhood has further reinforced this idea.

Additionally, Bitcoin maxi Michael Saylor told the audience that Ethereum and other altcoins are unregistered crypto asset securities; This is a rhetoric that the SEC has long suggested through lawsuits or its refusal to classify ETH as a commodity or security.

While the SEC’s stance remains largely unclear, experts believe this trend may change due to bills and proposals in Congress that could clarify which agency can regulate the crypto industry.