Record-Breaking Inflows in Crypto-Related Products: A Shift in Global Investments
The cryptocurrency market witnessed a remarkable surge in investments last year, with crypto-related products recording a staggering $44.2 billion in inflows. This figure is nearly four times higher than the previous all-time high of $10.5 billion set in 2021, according to CoinShares’ latest report.
Whales Accumulate Bitcoin
The introduction of US spot-based exchange-traded funds (ETFs) played a significant role in this record-breaking performance. Bitcoin ETFs dominated the scene, drawing $38 billion in inflows and accounting for 29% of the total assets under management (AuM). This significant inflow resulted in a notable increase in Bitcoin ETFs’ holdings, which surpassed one million BTC in less than a year of their launch. Leading products like BlackRock’s iShares Bitcoin Trust and Fidelity’s Fidelity Advantage Bitcoin ETF attracted the most interest.
Shift in Investments: US Leads the Way
The positive flows in ETF products resulted in the US leading global inflows, attracting almost all of the $44.4 billion. Switzerland followed with $630 million. However, significant outflows from Canada and Sweden, totaling $707 million and $682 million, respectively, partially offset these gains. James Butterfill, CoinShares head of research, noted that the outflows suggest a shift in investments from these regions to US-based products, underscoring the growing appeal of the American crypto market.
Ethereum Resurgence
Ethereum also stood out for its performance, especially in the latter part of the year. The digital asset secured $4.8 billion in inflows as its ETH spot-based ETFs ended the year strongly. This inflow represented 26% of its AuM, which is 2.4 times higher than its 2021 total and vastly exceeds its 2023 performance.
Other Cryptocurrencies: A Mixed Bag
Meanwhile, Ethereum’s gains outpaced its rival Solana, which managed $69 million in inflows, representing just 4% of its AuM. Other large-cap alternative coins, such as Polkadot, Cardano, XRP, and others, collectively attracted $813 million, accounting for 18% of their AuM.
2025 Flows: A Positive Start
This year has started on a positive note for Bitcoin investment products in the US, with inflows reaching $666 million in the first two trading days. According to Farside data, January 3 saw a $908 million inflow in a single day, with Fidelity leading at $357 million, just ahead of BlackRock and Ark Invest at $253 million and $222 million, respectively.
Conclusion
In conclusion, the cryptocurrency market witnessed a significant surge in investments last year, driven by the introduction of US spot-based ETFs. Bitcoin ETFs dominated the scene, while Ethereum also showed a strong performance. The shift in investments from Canada and Sweden to US-based products underscores the growing appeal of the American crypto market. As the market continues to evolve, it will be interesting to see how these trends play out in the coming year.
Source: Cryptoslate.com
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