Bitcoin-based investment funds led $619 million in weekly crypto ETP inflows, according to CoinShares, as institutional investors continued allocating capital to digital assets despite rising geopolitical tensions in the Middle East.
The inflows mark the second consecutive week of positive flows after crypto investment products recorded roughly $1 billion in inflows the previous week, ending a five-week streak of withdrawals earlier in the year.
CoinShares’ head of research, James Butterfill, stated that the continued crypto ETP inflows represent a general positive attitude towards digital assets. Butterfill added that institutional investor demand has remained robust even during times of geopolitical pressure.
Regional data illustrates that investor interest in digital assets remains most active within the United States. This is evidenced by the fact that U.S.-based digital asset investment products had inflows of approximately $646 million this past week.
There were modest outflows of $23.8 million, $2.2 million, and $3.6 million from digital asset investment products based in Europe, Asia, and Canada, respectively.
This indicates that institutional investor demand in the United States remains the dominant driver of crypto ETP inflows globally. The majority of investor interest in digital assets can be attributed to an increase in investor accessibility through regulated exchange-traded investment products.
Source: CoinShares
Earlier in the week, investor demand for digital assets was at its highest. Approximately $1.44 billion flowed into these digital asset investment products in the first three days of the trading week.
As oil prices rose, investor sentiment softened mid-week. This caused $829 million to leave digital asset investment products on Thursday and Friday of the trading week, reducing the total crypto ETP inflows of the week.
Although inflows were reduced as a result of the late-week pullback, the data illustrate that institutional investors continue to desire to build exposure to digital assets. Also, such a desire remained regardless of the existence of macroeconomic and geopolitical pressures.
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Digital asset investment products tied to Bitcoin accounted for approximately $521 million of the total crypto ETP inflows for the week. This once again illustrates Bitcoin’s role as the primary vehicle through which institutional capital enters the digital asset marketplace.
Additionally, short Bitcoin investment products had inflows of approximately $11.4 million. This illustrates that a number of investors are attempting to hedge against possible volatility.
Other digital assets also had new allocations in their respective funds during the week. For example, Ethereum-based funds had inflows of approximately $88.5 million, while Solana-based funds had inflows of nearly $14.6 million.
Additionally, Uniswap- and Chainlink-based funds each had inflows of approximately $1.4 million. Conversely, XRP-based investment products had the largest outflows of any major asset during the reporting period, totaling approximately $30.3 million.
The ETF market data further illustrates continued institutional participation in digital asset investment products. From March 2nd to March 6th, spot Bitcoin ETFs had approximately $568 million in net inflows according to data from SoSoValue. Additionally, spot Ethereum and Solana ETFs had approximately $23.6 million and $24 million, respectively, in net inflows.
Source: SoSoValue
Increased crypto ETP inflows during times of geopolitical tension suggest that institutional investors increasingly consider Bitcoin and digital asset funds as long-term strategic investments rather than as short-term speculative bets.
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