Crypto Inflows Surge in the US, Bitcoin Leads Recovery

Crypto investment products have reached their highest inflows in five weeks, according to CoinShares. The United States led with $135 million in inflows. Total inflows into crypto investment products were $130 million, despite a drop in Exchange-Traded Product (ETP) volumes to $8 billion, down from April's $17 billion average. James Butterfill from CoinShares noted a decline in ETP volumes, indicating reduced investor interest. Global trusted exchange volumes fell from 31% last month to 22% recently, showing less trading activity overall.

The U.S. saw the highest inflows at $135 million, highlighting strong domestic interest. Over 50 million Americans have invested in crypto. Hong Kong followed with $19.1 million, though this was less than the previous week, suggesting initial investments post-Bitcoin ETF approval were seed capital. Switzerland had $14.1 million in inflows.

Conversely, Canada, Germany, and Sweden recorded outflows of $20 million, $14.9 million, and $4.8 million, respectively. The total outflows from Canada and Germany have reached $660 million, indicating significant withdrawals.

The pressure to approve a spot Ethereum ETF in the U.S. is rising, especially after Hong Kong approved similar ETFs. Bearish sentiments about the U.S. approval are growing due to low engagement between U.S. regulators and ETF issuers. Last week, Ethereum saw outflows of $14.4 million.

The SEC recently postponed its decision on the Invesco Galaxy spot Ethereum ETF to July 5, 2024, adding to the uncertainty. Despite this, Ethereum rose 1.1% in the past day, trading at $2,966, with trading volumes up 86% to $11.2 billion. Upcoming weeks are crucial for Ethereum, as SEC updates could significantly impact its market.

The recent inflows, particularly in Bitcoin, suggest renewed interest and possible market recovery. However, declining ETP volumes and regional outflows show mixed investor feelings. The regulatory environment, especially for Ethereum ETFs, remains a key factor. Investors will be watching the SEC's decisions closely, which will likely shape the market's future. Bitcoin's strong performance is encouraging, but overall, the market remains cautious with varied investment trends.