Crypto investment products experienced a remarkable inflow of $3.4 billion from April 21-25, with a significant portion directed towards U.S. spot bitcoin ETFs. Factors like corporate earnings tariffs and a weakening U.S. dollar are believed to drive this move to digital assets, which are increasingly seen as a safe haven. The inflow trends suggest a mix of contributions from both institutional hedge funds and long-term individual investors, while clarifications around upcoming XRP ETFs highlight nuances in the market.
In a remarkable shift, crypto investment products saw a significant net inflow of $3.4 billion between April 21 to April 25, according to a recent report from CoinShares. This marks the largest inflow since December and stands as the third-highest weekly total of all time. The vast majority, approximately $3.1 billion, was directed towards U.S. spot bitcoin ETFs, with Ethereum ETFs also experiencing a boost; they recorded net inflows of $183 million, effectively ending an eight-week streak of outflows.
James Butterfill, a figure from CoinShares, attributes this surge in crypto investment to ongoing concerns over tariffs impacting corporate earnings and a notable decline in the value of the U.S. dollar. He mentioned, “Digital assets are increasingly being viewed as a safe haven for investors during these turbulent times.” The emphasis on “emerging” as a safe haven is essential, as Bitcoin has recently demonstrated some decoupling from tech stocks, even if only temporarily. At its latest trading point, Bitcoin was priced around $94,130, marking a 10.5% surge from the previous week.
However, locating the specific types of investors driving these inflows is complex. Eric Balchunas from Bloomberg Intelligence highlighted the rapid uptick in Bitcoin ETF investments via a post on X. He suspects that a portion of the influx is attributed to the “basis trade” back in play—this refers to hedge funds making strategic moves based on the difference between Bitcoin’s futures and spot prices. From previous Q1 13F filings, it’s clear that hedge funds constitute around 37% of the assets held in spot Bitcoin ETPs that professional investors manage.
Beyond these professional investors, there’s a notable interest from individual investors and smaller financial advisors, who are also crucial players in this current phase of investment. Ryan Rasmussen of Bitwise noted that it’s reasonable to assume long-term investors drove the majority of recent flows, with potentially less influence from hedge funds engaging in the basis trade tactic.
Turning to some ETF-related news specifically about XRP, there are a couple of important clarifications. The XRP funds that ProShares has proposed are based on futures, not spot market offerings. Additionally, a spokesperson from ProShares confirmed there are no plans to launch these products live this Wednesday, despite some circulating reports. It’s also worth noting that the CME Group plans to roll out XRP futures contracts on May 19. Updates regarding crypto ETFs will continue to be shared as they become available.
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