Crypto funds see first institutional investment in 5 weeks

It is the first time in five weeks that there has been a net positive inflow as $14.4 million re-entered the space with investors buying the dip

After five weeks of constant outflows, institutional investment is finally trickling back into crypto funds with BTC the asset of choice and ETH falling out of favour.

In its weekly Digital Asset Fund Flows report published on Jan. 24, crypto investment firm CoinShares observed inflows for some institutional products.

It is the first time in five weeks that there has been a net positive inflow as $14.4 million re-entered the space with investors buying the dip.

The researchers reported that these inflows came during a period of significant price weakness, adding that this suggests investors are seeing this as a buying opportunity at current price levels.

Capital continued to flow out from CoinShares own BTC fund, however, 21Shares and ProShares registered minor gains.

Most of the inflows were for Bitcoin which had $13.8 million for the week. Ethereum was the biggest loser over the period with an outflow of $15.6 million, but the multi-asset products made up the balance resulting in a net overall inflow.

CoinShares observed that the current seven-week run of ETH outflows now total $245 million highlighting much of the recent bearishness amongst investors has been focused on Ethereum rather than Bitcoin.

Analyst Willy Woo also suggested it was early signs that institutional funds are starting to return. He tweeted: Early signs that institutional money is starting to come back in.

However, the total assets under management (AUM) for the funds included in the report was $51 billion, its lowest level since early August 2021. The AUM has been depressed due to the falling value of the underlying assets over the past couple of months.

There was no change in the world’s largest fund, Grayscale, which has $30.6 billion in AUM according to its latest update on Jan. 25, however, the fund was trading at a record discount of around 30%.