U.S. Crypto Reforms Drive $60B Surge in Digital Assets

The inflow of capital into digital assets has totaled $60 billion since the beginning of the year, according to a report from JPMorgan analysts.

This figure has grown by almost 50% since the end of May and could exceed last year’s record. The primary sources of capital inflow are crypto funds, the CME futures market, and venture investments.

The main catalyst is an improved regulatory environment in the U.S. Analysts say the GENIUS Act has brought clarity to stablecoin regulation and set a benchmark for other countries.

Another document, the CLARITY Act, could make the United States more attractive to crypto companies compared to the EU and its MiCA regulation, according to analysts.

Improved legislation is stimulating activity in the markets. Venture capital funding has increased, and public companies are showing new momentum. Analysts have noted the successful IPO of Circle, as well as growth in new applications filed with the SEC.

Demand for Ethereum

Investors are also showing increased interest in altcoins. Ethereum has been the main beneficiary, thanks to its dominance in DeFi and its growing use in corporate reserves alongside Bitcoin.

Asset managers are interested in launching altcoin ETFs with staking functionality.

In particular, the iShares Ethereum Trust (ETHA) exchange-traded fund from BlackRock attracted $10 billion in a year, according to Bloomberg senior analyst Eric Balchunas.

He noted that this instrument became the third in history in terms of how quickly it reached this milestone. The first two are Bitcoin ETFs from BlackRock and Fidelity. Balchunas also observed that assets in the fund grew from $5 billion to $10 billion in just ten days. The fund entered the top five in terms of inflows over the past week and month.

On July 25, net inflow into spot Ethereum ETFs amounted to $332.2 million. Almost all of this amount—$324.6 million—came from the BlackRock fund. The total inflow into all nine spot Ethereum ETFs traded in the U.S. reached $8.65 billion.

The U.S. Securities and Exchange Commission approved the launch of such products in May 2024. Trading began on July 23, 2024.