Global digital asset investment products have continued to see positive inflows for the fourth consecutive week, reaching a total of $185 million in May, according to the weekly report from CoinShares. These inflows have propelled the total for the month to an impressive $2 billion, highlighting a significant increase in investor interest in the cryptocurrency market. Year-to-date inflows have now exceeded $15 billion, marking a milestone for the industry. Despite this positive trend, trading volume experienced a slight decline from $13 billion to $8 billion compared to the previous week.
Bitcoin continues to lead the way in terms of attracting investment, with investors showing strong interest in the flagship digital asset. In the past week alone, Bitcoin recorded inflows amounting to $148 million, while short BTC products experienced outflows of $3.5 million. The United States emerged as the top destination for investment, garnering $130 million in inflows despite a $260 million outflow from Grayscale's GBTC. Notably, BlackRock and Fidelity's spot Bitcoin ETFs received significant inflows totaling $475 million, further solidifying the US's position as a key player in the crypto market.
Switzerland witnessed its second-highest inflows of the year, with investors pouring in $36 million into digital asset products. Canada, on the other hand, managed to reverse the trend of outflows from previous weeks, contributing $25 million in inflows despite a net monthly outflow of $39 million. In a surprising turn of events, Hong Kong shifted from its outflow trend to record modest inflows of $1.7 million, signaling a potential shift in investor sentiment in the region.
In a separate development, Ethereum-related investment products saw a boost in inflows for the second consecutive week, with investors injecting $34.5 million into these financial instruments. This positive trend comes on the heels of the Securities and Exchange Commission's (SEC) approval of 19b-4 filings for spot Ethereum ETF products. Prior to this approval, Ethereum had been experiencing a 10-week streak of outflows totaling $200 million. The approval of these ETF products is expected to further fuel investor interest in Ethereum, with experts predicting that trading could commence as early as July, although there is no definitive timeline as the regulatory process is ongoing.
The approval of Ethereum ETFs also had a ripple effect on other large-cap altcoins, with assets such as Solana seeing inflows of $5.8 million. Additionally, altcoins like Chainlink, XRP, and Litecoin recorded minor inflows of less than $1 million, indicating a broader positive sentiment in the cryptocurrency market beyond Ethereum.
Overall, the influx of funds into the cryptocurrency market in May, particularly in Bitcoin and Ethereum-related products, demonstrates growing investor confidence in digital assets as viable investment options. The approval of Ethereum ETFs by the SEC has sparked renewed interest in the sector, paving the way for further innovation and development in the blockchain space. As the market continues to evolve and regulatory approvals streamline access to these assets, the outlook for cryptocurrencies remains optimistic, attracting both retail and institutional investors looking to capitalize on the potential of this burgeoning market.
