Bitcoin Bags $2B Inflows, Ether Sees Highest Institutional Buying Since March

Crypto investment products took on nearly $2 billion in inflows last week to help extend a five-week run to over $4.3 billion, asset manager CoinShares said in a Monday report.

Trading volumes in exchange-traded products (ETPs) rose to $12.8 billion for the week, up 55% from the week prior. Bitcoin led investment activity at over $1.97 billion inflows for the week, while ether (ETH) saw its best week of inflows since March at nearly $70 million.

Buying activity for spot bitcoin exchange-traded funds (ETFs) in the U.S. has picked up since mid-May after a dismal few weeks in April, which saw days of zero net inflows across all products and even outflows from major products such as BlackRock's IBIT. However, inflows have since picked up - with IBIT becoming the largest bitcoin ETF last week amassing over $20 billion worth of the asset since its January issuance.

“Unusually, inflows were seen across almost all providers, with a continued slowdown in outflows from incumbents,” CoinShares analyst James Butterfill said. “Positive price action saw total assets under management (AuM) rise above the $100 billion mark for the first time since March this year.”

Butterfill added ETH buying was likely in reaction to the surprise SEC decision to allow spot ether ETFs.

Meanwhile, some traders expect the inflows into ETH products to continue in the coming months, with a rally expected toward the end of the year.

“$5-10 billion of fresh capital could be channeled through ether products in the short to medium term,” Ed Hindi, Chief Investment Officer at Tyr Capital, told CoinDesk in a Monday email. “This could fuel an end-of-year rally in ETH and its ecosystem to new record highs.”

“A price target of $10,000 in 2024 is now a reasonable target especially when other supportive factors, like ETH now being deflationary, are taken into consideration,” Hindi added.

In May, the U.S. Securities and Exchange Commission (SEC) on Thursday approved key regulatory filings tied to ETH ETFs, a historic milestone for the second-largest cryptocurrency.

The regulator approved documents for eight ETFs – from VanEck, Fidelity, Franklin, Grayscale, Bitwise, ARK Invest 21Shares, Invesco Galaxy and BlackRock – for listing on the Nasdaq, NYSE Arca, and Cboe BZX exchanges.