European digital asset manager CoinShares has noted a slowdown in Bitcoin ETF hype, despite the asset’s recent surge to over $71,000 per coin. The company pointed out that while the biggest Bitcoin funds are still seeing inflows, the numbers are smaller than they were earlier in March. CoinShares’ Bitcoin Flow Tracker reported a decline in volumes last week to $17.4 billion, compared to $43 billion in the first week of March. Flows to digital asset products totaled $646 million for the week, with the majority going towards Bitcoin exposure.
Year-to-date, inflows for digital asset products have reached $13.8 billion, surpassing the $10.6 billion seen in 2021. Most of these inflows have gone to Bitcoin spot ETFs approved in January, which have received $12.6 billion in net flows since their launch. The total volume traded by these ETFs in March exceeded $111 billion, a significant increase compared to previous months. However, the Grayscale Bitcoin Trust (GBTC) has experienced continuous outflows since its launch, as early investors have been selling off their holdings during Bitcoin’s price surge.
Internationally, Swiss and Canadian crypto funds have also seen losses, with Switzerland losing $27 million and Canada losing $7.3 million last week. Canada’s Purpose Bitcoin ETF, the first Bitcoin spot ETF in the world, has lost over 20% of its Bitcoin holdings since competing products from BlackRock and Fidelity were launched in January. Despite these losses, overall flows continue for Bitcoin funds, while short Bitcoin investment products have seen their third consecutive week of outflows at $9.5 million. Ethereum has also experienced outflows for the fourth straight week, losing $22.5 million from related funds.
It is worth noting that Ethereum does not yet have its own spot ETF, and experts are becoming less optimistic about the approval of current applications for the product by the May deadline. This lack of a spot ETF for Ethereum could be contributing to the outflows from related funds. CoinShares’ data shows that Bitcoin ETFs are still attracting significant inflows, but the hype around these products seems to be slowing down. While Bitcoin funds are still seeing positive flows, there are concerns about the sustainability of these trends, particularly as the market becomes more saturated with new offerings and competition from traditional financial institutions. Despite these challenges, the overall interest in digital assets remains high, with investors continuing to seek exposure to cryptocurrencies like Bitcoin and Ethereum.
