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US Politics increasing hype in digital assets with a further US$901m inflows
Digital asset inflows reached US$901m last week, pushing year-to-date inflows to US$27bn, nearly triple the 2021 record.
The US led with US$906m in inflows, while Germany and Switzerland saw minor gains, and Canada, Brazil, and Hong Kong recorded small outflows.
Bitcoin attracted US$920m, likely due to US political factors, while Ethereum saw US$35m in outflows; Solana and blockchain equities showed gains of US$10.8m and US$12.2m, respectively.
Digital asset investment products saw inflows of US$901m, with inflows this month representing 12% of total assets under management, making it the 4th largest month of inflows on record. Total inflows this year now total US$27bn, nearly triple the 2021 record, with inflows of US$10.5bn.
Regionally, the US saw the highest inflows at US$906m. In contrast, the rest of the world showed a mixed picture: Germany and Switzerland recorded inflows of US$14.7m and US$9.2m, respectively, while Canada, Brazil, and Hong Kong experienced modest outflows of US$10.1m, US$3.6m, and US$2.7m, respectively.
The focus was almost entirely on Bitcoin, which saw inflows of US$920m. However, this was not accompanied by inflows into short-Bitcoin positions (as is usually the case), which instead saw minor outflows of US$1.3m. We believe that current Bitcoin prices and flows are heavily influenced by US politics, with the recent surge in inflows likely linked to the Republicans poll gains.
This positive sentiment was not reflected in Ethereum, seeing the largest outflows of any asset last week totalling US$35m, while Solana saw the second largest inflows at US$10.8m.
Blockchain equities are also seeing a recovery, with inflows for the 3rd consecutive week totalling US$12.2m last week.
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