Crypto exchange-traded funds (ETF) witnessed a second consecutive week of net inflows, pulling in $3.4 billion last week. This marks the largest inflows since mid-December and the third highest on record, per CoinShares weekly inflow report.
The influx of capital into crypto products highlights renewed demand among institutional investors amid the weakening influence of the US Dollar. It also suggests that investors are increasingly viewing crypto funds as an emerging safe-haven asset class, noted CoinShares.
On the regional scale, United States (US) products witnessed the highest inflows, totaling $3.3 billion. Germany and Switzerland also saw inflows of $51.5 million and $41.4 million, respectively.
Bitcoin ETFs witnessed the largest inflows among crypto products, netting $3.18 billion last week after the top digital asset reclaimed the $94,000 level for the first time since early March.
Due to the increase in institutional demand, Standard Chartered's global head of digital assets research, Geoffrey Kendrick, highlighted in a note on Monday that Bitcoin could hit $120,000 in Q2 while maintaining his initial price forecast of $200,000 at the end of the year. Kendrick urged investors to "buy now" as he emphasized a shift in demand from US assets.
"The correlation breakdown and US buying suggest that US investors are seeking non-U.S. assets," said Kendrick.
QCP analysts highlighted a similar trend, noting an alteration in Bitcoin's correlation with other assets.
This flip-flopping between safe-haven and risk-asset behaviour suggests that traditional correlation frameworks are becoming less instructive, noted QCP analyst. “Instead, market participants are now focused on the durability of BTC’s ‘up only’ trend.”
Furthermore, business intelligence firm Strategy filed that it purchased 15,355 BTC for $1.4 billion last week, bringing its total holdings to 553,555 Bitcoin.