Inflows into Bitcoin (BTC) funds continued for the second week in a row, outpacing the performance of other digital asset funds.
More than $506 million has been invested in bitcoin-focused mutual funds since the beginning of the year, according to the latest data from digital asset fund provider CoinShares. New money invested in bitcoin funds countered the losses of non-bitcoin or alternative cryptocurrency funds by around $100 million (altcoins).
“Investors are flocking to the relative safety of bitcoin.”
James Butterfill
According to James Butterfill, director of research at CoinShares, “investors are flocking to the relative safety of bitcoin.”
With inflation and interest rate rises from central banks throughout the globe and mounting worries of recession, some investors are reducing their exposure to risk assets, including cryptocurrencies. Because of its long history and enormous market capitalization, investors in digital assets consider bitcoin to be a less dangerous investment than most others. “Dominance,” or the percentage of the industry’s total market value held by Bitcoin, has continued to rise.
BTC was changing hands at $31,259 at the time of writing, with a price range of $29,000 to $32,000.
Nine straight weeks of withdrawals from Ethereum funds have been recorded. The second-largest cryptocurrency, ether (ETH), has had $357 million in outflows this year, bringing the total to $32 million. Moreover, outflows surged in December 2021 and only account for 7% of total assets under management, according to the study.
Bitcoin short funds, which aim to profit from a decline in the value of bitcoin, had a 1.3 million dollar influx.
There has been a strong desire for investors to diversify their portfolios by using multi-asset funds that handle more than one cryptocurrency, with inflows totaling $4.3 million since the beginning of the year.
There was little movement in funds that invest in cryptocurrencies other than bitcoin and ether. Solana (SOL) and XRP (XRP) hedge funds each received less than $200,000 in new capital.
The Americas accounted for the bulk of last week’s influx, with a total of $88 million. “European investors have been substantially more negative this year so far,” according to the report, which noted that European funds received only $11 million in inflows in the past week.
