Investors cautiously re-enter crypto funds as ethereum investment products perform strongly

A number of funds have started to see net inflows, with ETH investment products seeing inflows totaling $47 million.

Investors cautiously re-enter crypto funds as ethereum investment products perform strongly

A new report from analyst firm Coinshares shows that while the decline in the crypto market may not be over, current price levels suggest that stock market investors are once again showing interest in digital asset funds.

A report released yesterday by Coinshares shows that multiple funds have begun to see net inflows, following weeks of record outflows from these funds as the cryptocurrency market experienced a plunge. A total of $74 million was invested in cryptocurrency investment products by the traditional market, but not all products showed strong momentum.

After record outflows in the first two weeks, cryptocurrencies saw inflows.
Ethereum investment products have a record 27% market share.

  • unfolded. (@cryptounfold) June 2, 2021
    With some analysts expecting the price of bitcoin to potentially fall to $16,000, bitcoin investment products were among the worst performers, with net outflows of $4 million. The report notes that cottage coins – particularly the greener proof-of-stake cottage coins – performed strongly, with Cardano, Ripple and Polkadot funds all seeing inflows of more than $3 million.

However, the report shows that the real star of the show was Ether. inflows to ETH investment products totaled $47 million, accounting for the majority of net investments in digital asset funds and giving ETH investment products a dominant market position of 27%.

The optimistic outlook for Ether by investors comes on the heels of a series of bullish reports issued by academic and institutional financial research departments. Last week, both the University of Pennsylvania and Goldman Sachs authored research reports arguing that Ether is a means of storing value, in part because of its importance to the DeFi ecosystem.

Ether has made many technical advances as the world’s largest Layer 1 smart contract platform and will face some difficulties. The second tier scaling solution, Arbitrum, will be coming online soon, the long-awaited gas fee reform of the EIP-1559 proposal will take place later this year, and the much-anticipated transition of Ether to a proof-of-stake consensus mechanism will begin at that time.

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