No wonder cryptocurrency markets were so lackluster last week: There just wasn't much appetite from investors to put new money into funds.
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Flows into digital asset investment products declined by roughly $79 million to $21 million during the seven-day period through March 26, the lowest since October, according to a new report by CoinShares, a digital asset investment firm.
Slowing investor appetite for cryptocurrency funds reflects sideways price action in bitcoin (BTC). The cryptocurrency has traded between $50,000 and $60,000 over the past week.
“Investor appetite for digital assets has waned in recent weeks as volatility remains high and the price trades sideways,” CoinShares wrote in the report.
“We have recently witnessed a significant reduction in inflows, and in some cases outflows, for the larger and longer-established pre-2016 investment products,” according to the report. "We believe this is due to investors sitting on multi-year gains taking profits."
Investment flows in the U.S. are slowing, while Europe and Canada continue to hold up.
Trading volumes in digital-asset investment products declined to $788 million per day last week, versus an average $900 million per day so far in 2021.
Bitcoin received the largest inflows, according to the report, "but Ethereum on a market capitalization basis (as we've seen in previous weeks) remains more popular with inflows of $5 million."