Inflows to institutional crypto investment products continue to be dominated by Ether and Cardano, while demand for Bitcoin falls.
This week has seen an upsurge in institutional inflows into altcoin investment products, but the same cannot be said for Bitcoin (BTC).
In its “Digital Asset Fund Flows Weekly” report on Monday, institutional asset manager CoinShares identified overall inflows of $24 million to altcoin-based investment products. The capital inflows to altcoin funds mark the second consecutive week of inflows, with investments in altcoin products increasing by 14.3 percent compared to last week’s $21 million.
Ether (ETH) was the most popular asset among institutional investors, with ETH-based instruments attracting $17.2 million in weekly inflows. According to the research, products tracking Ether and other altcoins currently account for 32% of the sector’s total assets under management (AUM), just 3% less than the mid-May record of 35%.
Cardano-based institutional funds received $10.1 million in weekly inflows, accounting for 32% of total cryptocurrency inflows for the week. Cardano-based securities now account for 0.15 percent of the total money invested in crypto investment products.
The increase in Cardano (ADA) inflows can be related to the network’s Sept. 12 Alonzo upgrade, which will see the project introduce smart contract capability for the first time.
Polkadot and Solana-based funds received $1.5 million and $2.7 million, respectively, in inflows. Solana (SOL) has eclipsed Bitcoin Cash (BCH) in terms of assets under management in linked funds, with $16 million, ranking ninth in terms of AUM, with BCH funds ranking tenth.
Despite the strong sentiment surrounding altcoins, the research indicated that Bitcoin products continue to see outflows, with a $3.8 million loss for the period. As a result, Bitcoin-related goods have had outflows in 14 of the last 16 weeks.
CoinShares estimates that institutional asset managers have a combined AUM of $56.8 billion, attributing the modest week-over-week dip in sector-wide AUM to ongoing outflows from Bitcoin-based products.
Looking at the performance of fund issuers, CoinShares’ Bitcoin fund suffered the most losses this week, with a $14.5 million outflow. The greatest inflow came from ETC Issuance, which received $14.1 million.