The past few months have brought in price spikes for majority cryptocurrencies, bringing back investors’ interest into the sector. In its recent data, CoinShares showed that investment products backed by digital assets like NFTs and cryptocurrencies managed to garner $932 million (roughly Rs. 7,766 crore) in last week’s four-day period between May 13 and May 17. This influx of capital in the digital assets arena happened soon after the US Labor Department’s Bureau of Labor Statistics released the consumer price index (CPI) data, which suggested that inflation status observed in April showed signs of cooling down.
“The inflows were an immediate response to the lower-than-expected CPI report on Wednesday, with the latter three trading days of the week making up 89 percent of the total flows, highlighting our view that Bitcoin prices have recoupled to interest rate expectations,” CoinShares Research blog said in a blog post that it published on Medium on May 20.
Weekly investments into Grayscale, iShares ETFs, Fidelity ETFs, Ark 21 Shares, ProShares ETFs, and Bitwise ETFs substanially swelled up last week in the US. BTC ETFs offered by Fidelity gained the maximum capital inflow of $344 million (roughly Rs. 2,866 crore).
Piggybacking on US’ inflation data, several cryptocurrencies rose in value this week. Bitcoin, for instance, touched the mark of $67,000 (roughly Rs. 55.8 lakh) on international exchanges one day ago, after having gone through a period of stagnancy around the price point of $63,000 (roughly Rs. 52.4 lakh) during the first fifteen days of May. As per the data shared by CoinShares, investments into Bitcoin last week totalled to a whopping $942 million (roughly Rs. 7,849 crore).
Solana, Litecoin, Cardano, and Chainlink also managed to garner investments in recent days alongside Bitcoin.
Ether, meanwhile, has not performed as impressively as BTC in the markets. As per the CoinShares blog, “Ethereum continues to suffer from bearishness over the prospects for an SEC approval of a spot-based ETF this week with further outflows of $23 million (roughly Rs. 191 crore).”
Investments in crypto rose most in the US last week. Australia, Brazil, Germany, and Switzerland emerged as other countries that saw a positive sentiment towards crypto among investors in recent days. Hong Kong and Canada, meanwhile, saw outflows from crypto totalling $83 million (roughly Rs. 691 crore) and $17 million (roughly Rs. 141 crore), respectively.
In the backdrop of this notable capital influx into digital assets-backed industrial products, Bitcoin witnessed a mega rally on Tuesday, May 21 as it crossed the mark of $71,000 (roughly Rs. 59 lakh).
“Investors gave a much-needed boost to BTC after the reports of big names like Morgan Stanley, JPMorgan, Wells Fargo, UBS, BNP Paribas, Royal Bank of Canada and hedge funds like Millennium Management and Schonfeld Strategic Advisors revealed their large Bitcoin ETF holdings. Bitcoin could test the $74,000 (roughly Rs. 61.6 lakh) level in the coming weeks if the current momentum continues. The euphoria around Bitcoin Pizza Day tomorrow may add to the already buoyant investor sentiment,” Shivam Thakral, CEO of Indian crypto exchange BuyUcoin told Gadgets360.
