New CoinShares Report Shows Dwindling Volume on Crypto Investment Products – Here’s What You Need to Know

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June 26, 2023 06:55 EDT

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Trading volumes in crypto-backed investment funds have dwindled in recent weeks, and last week hit its lowest since October 2020, a new report from the crypto researcher CoinShares shows.

According to the report, the volume in crypto investment products last week fell to as low as $758m, far below the $7bn a week average seen at this time last year.

Moreover, overall outflows from crypto investment products of $5m showed that investor interest in crypto still remains at low levels, with “apathy” being the general sentiment in the market, the report said.

In terms of specific digital assets, bitcoin (BTC) funds last week saw the largest inflows, with $4.6m entering these funds on a net basis. That was followed by funds backed by Ripple’s cryptocurrency XRP, which recorded inflows of $0.8m.

At the other end of the spectrum, short-bitcoin funds saw the biggest outflows with $7.1m leaving – a sign that investors are starting to turn more bullish on the number one cryptocurrency. The second-biggest losing category were ethereum (ETH) funds, with $2.5m in outflows, the data showed.

Total assets under management in crypto investment products now stand at $24.9bn, according to the CoinShares data.

The flows last week marked a notable change from the prior week, when crypto-backed funds as a whole saw inflows of $12m. Worth noting, however, is that while short-bitcoin funds saw significant outflows last week, the same fund category actually saw inflows of $6.7m the week before, which indicates that investors are now becoming more bullish on bitcoin.

Trading volumes continue to dwindle

Meanwhile, Arcane Research also said in a market update on Tuesday that activity in the spot crypto market continues to dwindle, with “no notable price swings” seen over the last week.

The firm added that when excluding Binance, which has bucked the trend on trading volume, the spot trading volume in bitcoin on crypto exchanges is at a two-year low.