Crypto investment products are witnessing one of their best months in history, as inflows reached $901 million in just the last week, according to CoinShares’ recent report.
Inflows Surge to Fourth-Highest on Record
This month’s inflows account for approximately 12% of the sector’s total assets under management (AUM), making it the fourth-highest month for inflows on record. Year-to-date inflows have surged to $27 billion, nearly tripling the previous record of $10.5 billion set in 2021.
Political Influence Drives Bitcoin Demand
Bitcoin received the majority of inflows, amounting to $920 million. This was largely driven by strong demand for BlackRock’s IBIT-led spot BTC ETFs, which saw a cumulative flow of $998 million in the past week. In contrast, short-Bitcoin products experienced a slight outflow of $1.3 million.
James Butterfill, CoinShares’ Head of Research, attributed Bitcoin’s price and inflows to the influence of US politics. He stated, “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.”
US Election and Crypto Support
As the US election draws closer, both leading candidates—former President Donald Trump and Vice President Kamala Harris—are increasing their outreach to crypto supporters. They are promoting pro-crypto policies to attract this growing voter demographic. A recent survey estimated that around 26 million voters view crypto as a crucial voting factor, which could significantly impact the election outcome.
Data from Polymarket, a decentralized betting platform, indicates that crypto investors favor Trump, who currently holds a 65% chance of winning, while Harris’s odds have dropped to 35%.
Ethereum Faces Outflows, Solana Gains Traction
While Bitcoin inflows remain strong, Ethereum faced outflows totaling $35 million last week, the largest for any digital asset. This aligns with the underperformance of Ethereum-based ETFs and reflects ETH’s ongoing price challenges compared to BTC, which is down 55% from its recent peak.
On the other hand, Solana gained momentum, securing the second-highest inflow at $10.8 million, followed by Litecoin with $1.8 million.
Blockchain Equities Show Positive Trend
The broader blockchain equities market also showed positive movement, with inflows recorded for the third consecutive week, totaling $12.2 million last week.
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