Cryptocurrency Fund Flows Now at Lowest Since October 2020

No wonder cryptocurrency markets were so lackluster last week: There just wasn't much appetite from investors to put new money into funds.

Mar 29, 2021 at 8:07 p.m. UTC
Updated Sep 14, 2021 at 12:33 p.m. UTC

Flows into digital asset investment products declined by roughly $79 million to $21 million during the seven-day period through March 26, the lowest since October, according to a new report by CoinShares, a digital asset investment firm.

Slowing investor appetite for cryptocurrency funds reflects sideways price action in bitcoin (BTC). The cryptocurrency has traded between $50,000 and $60,000 over the past week.

"Investor appetite for digital assets has waned in recent weeks as volatility remains high and the price trades sideways," CoinShares wrote in the report.

  • “We have recently witnessed a significant reduction in inflows, and in some cases outflows, for the larger and longer-established pre-2016 investment products,” according to the report. "We believe this is due to investors sitting on multi-year gains taking profits."
  • Investment flows in the U.S. are slowing, while Europe and Canada continue to hold up.
  • Trading volumes in digital-asset investment products declined to $788 million per day last week, versus an average $900 million per day so far in 2021.
  • Bitcoin received the largest inflows, according to the report, "but Ethereum on a market capitalization basis (as we've seen in previous weeks) remains more popular with inflows of $5 million."

CoinShares chart shows how dramatically inflows to cryptocurrency investment funds fell last week.

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