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Bitcoinist 2025-01-14 05:30:15

Bitcoin Tops Crypto Inflows Again, But Ethereum Faces Major Setback—Here’s What Happened

The latest weekly report from CoinShares, a prominent European digital asset investment firm, reveals notable shifts in crypto asset fund flows. The report highlights inflows of $48 million into digital asset investment products during the past week. However, the overall picture appears to be more complex, reflecting the impact of macroeconomic factors and investor sentiment on fund flows. James Butterfill, Head of Research at CoinShares, noted that while nearly $1 billion flowed into digital asset products during the first half of the week, the release of new macroeconomic data and the US Federal Reserve’s minutes led to significant outflows of $940 million in the “latter half.” Butterfill wrote: The release of new macroeconomic data and the US Federal Reserve’s minutes — which pointed to a stronger US economy and a more hawkish Fed — led to outflows of US$940 million in the latter half. This suggests that the post-US election honeymoon is over, and macroeconomic data is once again a key driver of asset prices. Bitcoin Leads Inflows While Ethereum Faces Outflows According to the CoinShares report, Bitcoin maintained its dominance in fund inflows last week, attracting $214 million. Despite being subject to outflows later in the period, Bitcoin remains the “ best-performing asset ” year-to-date, with cumulative inflows of $799 million. This performance highlights its continued appeal to investors seeking exposure to digital assets amid broader market fluctuations. In contrast, Ethereum faced significant pressure, recording outflows of $256 million. Butterfill attributed this trend to a broader sell-off in the technology sector rather than any specific issues with the Ethereum network itself. Meanwhile, Solana stood out as a positive exception, attracting inflows of $15 million, suggesting resilience in certain altcoin sectors even amidst challenging market conditions. Overall, altcoins exhibited mixed but generally positive trends despite underwhelming price performances. Aave, Stellar, and Polkadot saw inflows of $2.9 million, $2.7 million, and $1.6 million, respectively, indicating sustained investor interest in these projects. This trend reflects a growing diversification in investment strategies as altcoins continue to attract niche markets and developers. XRP recorded inflows of $41 million, with Butterfill linking this activity to ongoing political and legal developments . The Head of Research at CoinShares noted: XRP saw substantial inflows of US$41m last week and remains primarily driven by political and legal factors, with inflows suggest heightened optimism ahead of the 15th January SEC appeal deadline. Global Crypto Market Outlook The global crypto market has faced notable bearish sentiment over the past week, shedding nearly $400 million from its total market capitalization . Particularly, the valuation has dropped from $3.662 trillion last Monday to $3.283 trillion as of today. This significant plunge in market capitalization can be mainly attributed to the continues bearishness in Bitcoin. At the time of writing, Bitcoin has now dropped below $91,000 bringing its price to trade at a price of $90,704 marking a 3.9% decrease in the past day. Featured image created with DALL-E, Chart from TradingView

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