🏦 401(k) Crypto Access Sparks $572M Inflows Into Funds
The study indicated $572 million in inflows, impacted by macroeconomic and regulatory data. CoinShares head of research James Butterfill remarked that market mood changed dramatically this week.
Early in the week, outflows hit $1 billion, perhaps due to growth fears from disappointing US payroll numbers. In the second part of the week, we witnessed $1.57 billion inflows, possibly due to the government's approval of digital assets in 401(k)s, he said. Institutional interest in crypto-based financial products seems to have increased after the legislative change.
Regions had uneven inflow activity. The US topped net inflows with $608 million, followed by Canada with $16.5 million. Germany, Sweden, and Switzerland witnessed $54.3 million in investment outflows.
CoinShares said seasonal reasons, especially the traditionally calmer summer trading period, caused a 23% drop in digital asset ETP trading volumes from the previous month.
Ethereum products dominated the week with $268 million in inflows, the most of any asset. Ethereum's year-to-date inflows reached a record $8.2 billion, while price appreciation boosted assets under management to an all-time high of $32.6 billion, up 82% from the start of the year.
Ethereum-based ETPs are drawing attention because to increased network activity, particularly in decentralized finance (DeFi) and staking ecosystems.
Bitcoin experienced $260 million inflows following two weeks of outflows. Short Bitcoin products lost $4 million, indicating traders' bearishness decreased.
Given the magnitude of the US 401(k) market, this regulation shift might create significant new demand. However, net outflows in Europe show that sentiment is varied.
With volumes down from the previous month and macroeconomic uncertainty still present, these inflows will largely rely on market circumstances, regulatory clarity, and Bitcoin and Ethereum performance.
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