Digital asset investment products experienced their second consecutive week of inflows, attracting a total of $321 million.
The increase in investment is believed to have been influenced by the Federal Open Market Committee’s (FOMC) recent decision to adopt a more dovish stance, including an unexpected 50 basis point interest rate cut, CoinShares said in a Monday report.
The move has spurred a wave of optimism across the market, leading to a 9% increase in total assets under management (AuM), which now stand at $9.5 billion.
US Leads In Terms of Inflows
From a regional perspective, the United States led the inflows with $277 million, while Switzerland followed with $63 million, marking its second-highest weekly inflows of the year.
However, not all regions experienced growth.
Germany, Sweden, and Canada saw outflows of $9.5 million, $7.8 million, and $2.3 million, respectively.
Bitcoin was the primary beneficiary, receiving $284 million in inflows.
Interestingly, short-bitcoin investment products also attracted $5.1 million, reflecting some hedging activity among investors.
Ethereum, however, continued its downward trend with outflows totaling $29 million for the fifth consecutive week, driven by withdrawals from the Grayscale Trust and limited interest in newly issued ETFs.
Solana, on the other hand, maintained steady inflows of $3.2 million, showing resilience amid market volatility.
Harris Shows Support for Crypto
Meanwhile, U.S. Vice President Kamala Harris has voiced support for emerging technologies, emphasizing plans to boost investment in AI and digital assets.
In a recent note, QCP Capital said Harris’ pro-crypto comments have sparked renewed optimism in the digital asset market.
Over the weekend, during a fundraiser, Harris pledged to support the growth of the cryptocurrency sector.
Her remarks come as a strategic move to appeal to the crypto community, with high-profile figures like Anthony Scaramucci backing her campaign’s crypto policies.
Harris’s statements, combined with positive macroeconomic factors, have given the crypto market a significant boost, leading to almost $60 million in short liquidations at the start of the week.
The surge aligns with predictions from QCP Capital, which previously anticipated a potential 13.8% rally in Bitcoin from its lows of $57,500.
Since last Monday, Bitcoin has rebounded nearly 12%, currently trading around $63,500, and appears poised for further gains.
The market’s sentiment shift is also evident in the options market.
The usual frontend Put skew observed over the past month is beginning to normalize, as more buyers are looking to capitalize on topside options while sellers are offloading downside risks.
Additionally, funding rates on major exchanges are improving, and basis yields are becoming more attractive, especially in light of recent interest rate cuts.
For investors looking to capitalize on this bullish momentum heading into the fourth quarter, QCP Capital suggests considering a Principal Protected Sharkfin product.
This investment offers a potential return of over 96% per annum with no downside risk, maturing on December 27, 2024, with a strike price of $80,000 and a barrier of $100,000, based on a current spot price of $63,500.
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