Crypto funds took profits as Bitcoin hit record high, report
Major crypto funds added just $29 million worth of digital assets last week, down from over $1 billion in the week before Christmas.
That’s a gut-wrenching 97% drop in crypto fund inflows, and CoinShares reckons it means whales could’ve taken profits as Bitcoin’s approached its latest all-time high.
Led by Grayscale, digital asset funds now control $34.4 billion dollars worth of cryptocurrency — over 80% of it made up of Bitcoin.
But Bitcoin’s historic rally has had a big impact on the trade volumes of crypto investment vehicles like Grayscale’s Trusts.
Trade volumes of crypto ETPs averaged 10.5% of Bitcoin’s — their highest point since December 2017 — with demand pushing prospective investors into paying massive premiums.
[Read more: Grayscale’s $13B portfolio is mostly Bitcoin]
Still, this bull market is seeing much greater participation than the last, noted CoinShares. Digital asset funds now sit on $8 billion in “net new assets,” up from $534 million three years ago.
In any case, CoinShares highlighted that more assets have flowed into funds than out since May 2019, a sign that funds really are using crypto as a store of value, despite the recent profit taking.