Record of capital inflows in the crypto market

The first week of August marks the sixth consecutive week of growth for inflows into crypto, according to a report by CoinShares.

Institutional investors drive up capital inflows into crypto sector

The first week of August saw record inflows into the crypto market with $3 million in digital asset investment products. 

This was the sixth consecutive week of inflows into the market totaling $529 million.

July had ended with inflows of $474 million following outflows of $481 million in June.

This is supposed to be yet another sign, as Bank of America experts point out, that we are moving toward a bullish market spiral for cryptocurrencies after the big declines in May and June. 

There are many signs, both from a technical analysis perspective and precisely from strictly economic ones, such as that on capital flows and outflows from exchanges to cryptocurrencies and related products.

The bank’s report reads:

“Investors are moving away from the margins as risky assets rally. Tight supply and continued net outflows from exchanges indicate that investors continue to HODL”.

Specifically, in the first week of the month, CoinShares experts reported outflows totaling $8.5 million for Bitcoin, while investment products related to shorting Bitcoin saw record outflows totaling $7.5 million for the second consecutive week, suggesting positive sentiment for the major digital currency.

How have these inflows affected crypto prices

Ethereum, on the other hand, which is seeing exponential growth in its prices in recent weeks, has seen inflows totaling $16 million, and over the past six weeks inflows have totaled $159 million. 

In the report, CoinShares experts, write:

“We believe this turn-around in investor sentiment is due to greater clarity on the timing of The Merge”.

Another very interesting finding from the report is the record number of new investment products released in the second quarter of the year, despite the large declines seen by the entire crypto market. An impressive 32 new products, one step away from the record of 33 reached in the last quarter of the year 2021.

These figures, according to many experts, show a renewed interest of investors who are buying digital assets at a discount again. Market sentiment seems to be back to positive again. 

The fact that market inflows are increasing, shows how demand for institutional is growing toward crypto products. Among them all, Ethereum seems to be the digital currency considered to have the greatest growth potential.