The latest CoinShares report shows crypto inflows hit $1.9 billion last week, marking a powerful display of investor confidence even as geopolitical risks intensify.
This is the ninth consecutive week of inflows, setting a new year-to-date (YTD) record of $13.2 billion.
Crypto Inflows Hit $1.9 Billion Amid Escalating Middle East Tensions
Despite mounting tensions in the Middle East, including Israel’s retaliatory strikes against Iran and North Korea’s vows of military support, crypto markets have shown surprising resilience.
“Digital assets defy geopolitical tensions with further inflows of $1.9 billion,” wrote James Butterfill, head of research at CoinShares.
The recovery is especially notable given the volatility seen earlier in the week. Just three days ago, BeInCrypto reported that the crypto market lost over $1 billion following Israel’s airstrikes on Iranian military targets.
In the same way, gold outperformed Bitcoin during that time, as investors sought safe-haven assets amid uncertainty.
Still, the broader crypto narrative appears undeterred. Bitcoin recorded $1.3 billion in inflows after two weeks of minor outflows, suggesting investors are buying the dip amid war-related volatility.
Ethereum also posted a strong showing, raking in $583 million. This marked its largest weekly gain since February, and brought its current inflow run to $2 billion, or 14% of its assets under management (AuM).
Crypto Inflows Last Week. Source: CoinShares Report
The chart shows that investor appetite extended to altcoins as well. XRP saw $11.8 million in inflows, ending a three-week streak of outflows. Sui attracted another $3.5 million in fresh capital.
Regionally, the United States dominated sentiment with $1.9 billion in inflows, followed by Germany ($39.2 million), Switzerland ($20.7 million), and Canada ($12.1 million).
However, outflows were recorded in Hong Kong ($56.8 million) and Brazil ($8.5 million), suggesting pockets of regional uncertainty.
With last week’s crypto inflows, the streak of positive flows into digital asset investment products extends. In the three weeks prior, crypto inflows reached $224 million, $286 million, and $3.3 billion, respectively.
Bitcoin and Ethereum Lead the Charge Despite Inflation and War Risks
The steady growth in inflows, even during periods of global tension, paints a clear picture of resilience among crypto investors. Despite the fear trade, institutions are rotating back into crypto, particularly Bitcoin and Ethereum.
However, the backdrop remains precarious. Rising oil prices driven by conflict in the Middle East could stoke inflation. JPMorgan recently warned that if Israel proceeds with a full-scale attack on Iran, US CPI (Consumer Price Index) inflation could surge as high as 5%, potentially pushing oil prices to $120 per barrel.
This would threaten the current market expectation that the Federal Reserve (Fed) might begin cutting interest rates by September.
Rate hikes, generally bearish for Bitcoin, tighten liquidity and raise borrowing costs, weakening risk asset valuations.
These inflation fears have added complexity to crypto’s recent price action. While Bitcoin briefly dipped amid war headlines, the renewed inflows suggest that many investors view digital assets as a long-term hedge against inflation and geopolitical instability.
With nine straight weeks of inflows and a $13.2 billion YTD total, the data shows that crypto markets, though not immune to macro risks, are increasingly being seen as part of the global flight to hard assets, alongside gold, during times of crisis.
