The cryptocurrency market witnessed a substantial infusion of $1.18 billion in funds last week, triggered by the spot Bitcoin ETF launch, according to a report by CoinShares.
Key Takeaways
- The launch of a spot Bitcoin ETF led to a notable $1.18 billion influx into digital assets last week, with trading volume reaching a record $17.5 billion.
- While substantial, the inflows did not surpass the previous record of $1.5 billion during the launch of Bitcoin futures ETF in October 2021.
- Bitcoin received the majority of the inflow, totaling $1.16 billion, accounting for 3% of its total assets under management (AuM).
- Other cryptocurrencies, including Ethereum, XRP, and Solana, also saw notable inflows, while blockchain equities received $98 million.
Significant Influx Driven by ETF Launch
Last week, the cryptocurrency market experienced a substantial infusion of $1.18 billion in funds, propelled by the launch of a spot Bitcoin ETF, as reported by CoinShares. This surge in activity, while notable, did not surpass the previous record of $1.5 billion set during the launch of the Bitcoin futures ETF in October 2021.
Read More: Bitcoin May Drop to $32,000 After Spot ETF Approval
The debut of the Bitcoin ETF significantly impacted trading volume, reaching an unprecedented $17.5 billion. This surge in volume accounted for nearly 90% of daily trading on exchanges, a substantial increase from the 2022 weekly average of $2 billion, as highlighted by CoinShares.
Bitcoin Dominates Inflows
Bitcoin emerged as the primary beneficiary of this influx, attracting $1.16 billion, equivalent to 3% of its total assets under management (AuM). Other cryptocurrencies also experienced notable inflows, with Ethereum receiving $26 million, XRP $2.2 million, and Solana $0.5 million.
In addition to the digital assets, blockchain equities witnessed significant inflows of $98 million, contributing to an impressive total of $608 million over the past seven weeks.
Impact of Recently-Launched ETFs
The potential impact of Bitcoin ETFs is currently under scrutiny, with experts speculating on their transformative effect on retail fund flows into the sector. Bitcoin advocate Vijay Boyapati anticipates that ETF approval could unleash substantial retail capital into Bitcoin. Hedge fund manager James Lavish cited Bloomberg research, noting a surge in total trading volume for the ten ETFs to $7.85 billion.
To Conclude
The recent infusion of $1.18 billion into the cryptocurrency market, driven by the launch of a spot Bitcoin ETF, signifies a positive trend in the digital asset space.
While not surpassing the previous record set during the Bitcoin futures ETF launch, the substantial trading volume and widespread interest in Bitcoin and other cryptocurrencies indicate a maturation of the market.
