FX.co ★ Cryptocurrencies enjoy growing inflow of capital

There has been an influx of capital into digital assets for two weeks in a row. Amid multi-year highs in the US dollar and yields of 10-year Treasuries, digital assets rose by $78 million, analysts said.

According to data provided by CoinShares, trading volumes in exchange-traded products increased by $1.13 billion last week. Bitcoin volumes alone on trust exchanges expanded by 16%.

Investors are allocating their funds for crypto assets as financial prospects continue to deteriorate in such influential countries as the United States. The US currently faces record levels of debt. Amid a new confrontation between Israel and Hamas threatening to plunge the entire region into chaos, oil prices could jump above $100 a barrel in the near future.

According to research by James Butterfill who refers to the head of CoinShares, there is a considerable difference between Europe and the US in terms of investment volumes. 90% of capital inflows into digital assets come from Germany and Switzerland. At the same time, Canada and the United States account for only $9 million in the total flood.

Bitcoin was the main beneficiary with inflows of $43 million.

Solana became the second-largest token with inflows of $23.9 million and continues to establish itself as the altcoin of choice.

Last week was an important test for Ethereum investors after the launch of 6 futures ETFs in the US. The new ETFs raised just under $10 million in their first week.

The launch of a futures-based Bitcoin ETF brought in $1 billion in its first week.

Importantly, while inflows into digital assets have increased over the past two weeks, the outbreak of fighting between Hamas and Israel threatens to reverse the trend, Bloomberg Intelligence senior macro strategist Mike McGlone warns.