CoinShares Report: “Downfalls Seen as Opportunity”

Crypto funds saw their biggest inflow in 14 weeks, with net inflows of $42 million in the seven days ending November 11, according to a new report from cryptocurrency investment management firm CoinShares. The increased investment inflows coincided with the sharp drop in the cryptocurrency market triggered by Sam Bankman-Fried’s collapsing FTX empire.

Bitcoin, the largest cryptocurrency by market capitalization, has dropped more than 20 percent in the last seven days and traded at around $16,400 on the first day of the week. According to CoinShares, despite the recent market downtrend, fund inflows may indicate that investors are “seeing this price weakness as an opportunity” and are “discriminating between trusted third parties and an inherently unsafe system.”

Inflows of $29 million, $8 million and $4.3 million were seen, respectively, in all regions, particularly in the USA, Brazil and Canada. Although Switzerland is the country with the highest number of entries since the beginning of the year, it has created an anomaly by recording small outflows totaling $4.6 million.

Its primary focus has been on Bitcoin with a total of 19 million entries. This amount was recorded as the largest entry since the beginning of August. However, ‘Short Bitcoin’ investment products also saw a total inflow of $12.6 million. Ethereum recorded small inflows totaling $2.5 million in its second week. While there was little activity in altcoins, funds with multiple cryptocurrencies had the largest inflow since June 2022, with a total of $8.4 million invested. This shows that investors see multi-asset funds as a relatively safe haven.