Inflows into digital currency funds and products have reached a record $4.2 billion for the first three months this year, indicating increasing institutional investor interest, according to figures by CoinShares.
The previous peak for crypto inflows was almost $4 billion in the fourth quarter of 2020, pushing total inflows for the year to $6.8 billion, based on the asset manager’s report.
Year to date, bitcoin (BTC) has seen the biggest inflows at $3.4 billion, with Ethereum coming in second at $731 million. Crypto assets under management have also soared to almost $56 billion compared to $37.5 billion at the end of last year.
Brief stay at record high
Passive investment products with $54 billion assets under management (AUM) continue to outperform their active peers with a smaller $786 million in AUM, CoinShares data show.
Passive funds monitor the price of crypto assets, while active strategies adjust the weightings of their underlying holdings based on market conditions.
The top global virtual currency, Bitcoin notched a record high of $61,781.84 on Saturday but has dropped since then as investors consolidated gains and in the face of a proposition by India to ban cryptocurrencies.
Bitcoin staged another decent advance this month following an already impressive February, climbing to $61,742 on March 13. BTC has so far barreled past the $1 trillion market valuation three times this year.
Drawing the regulators’ attention
“The failure to maintain a foothold past the $60,000 level and the drop is likely the outcome of the flat-to-negative Coinbase premium – a major bellwether for institutional demand,” Coindesk quoted Ki Young Ju, chief executive officer of blockchain analytics firm CryptoQuant, as saying.
“As bitcoin moves into the mainstream and draws in greater attention, it will likely attract further scrutiny from regulators in the US and Asia,” according to Jesse Cohen, senior analyst at Investing.com.
Meanwhile, crypto AUM has also rallied to a high of $56 billion, based on CoinShares figures. Five digital asset investment providers now oversee assets of over $5 billion.
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