Cryptocurrencies post inflows for 7 straight weeks, led by bitcoin: Data

By Gertrude Chavez-Dreyfuss

NEW YORK (Reuters) - Cryptocurrency investment products and funds recorded inflows for a seventh straight week, as institutional investors warmed to more supportive statements from regulators, data from digital asset manager CoinShares showed on Monday.

Inflows to the sector were $90.2 million last week, led by bitcoin which snagged $69 million, according to CoinShares data as of Oct. 1. Over the past seven weeks, crypto inflows reached $390 million. For 2021, inflows totaled $6.1 billion.

Bitcoin recorded its third straight week of inflows.

"We believe this decisive turnaround in sentiment is due to growing confidence in the asset class amongst investors and more accommodative statements from the U.S. Securities Exchange Commission and the Federal Reserve," wrote James Butterfill, investment strategist, at CoinShares.

SEC Chairman Gary Gensler last week at a Financial Times conference reiterated his support for bitcoin exchange traded funds that would invest in futures contracts instead of the digital currency itself.

A day later, Fed Chair Jerome Powell, in remarks before Congress, said the Fed had no intention of banning cryptocurrencies.

Bitcoin on Monday hit a four-week high of just under $50,000 and was last up 2.3% at $49,333.

Blockchain data provider Glassnode, in its latest research note on Monday, pointed out that as bitcoin rallied out of its narrow trading range last week, approximately 10.3% of the circulating supply returned to an unrealized profit.

Ethereum products and funds, meanwhile, posted another week of inflows totalling $20 million, despite conceding market share to bitcoin in recent weeks. Inflows to ether, the token for the Ethereum blockchain, so far this year amount to $1 billion.

Ether was last down 0.4% at $3,403.

Still, despite consecutive weekly inflows across crypto products, volumes were low at $2.4 billion last week, CoinShares data showed, compared to $8.4 billion in May 2021.

Assets under management at Grayscale and Coinshares, the two largest digital asset managers, climbed last week to $41.1 billion and $4.6 billion, respectively.

 

(Reporting by Gertrude Chavez-Dreyfuss; editing by Richard Pullin)