Crypto investment products trail behind in Q1 but market demonstrates extended recovery

• Products tracking crypto assets have registered lower inflows in Q1, 2022, in comparison to the same period last year.
• Still, data shows investor optimism as YTD flows hit $501M and AUM tops $60billion.

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A recent report by CoinShares has highlighted the considerable difference in inflows to crypto investment products between the now ended Q1 of 2022, and the same period last year. 

According to the asset management firm, inflows to products tracking crypto assets were markedly lower in this year’s Q1. Bitcoin (BTC) investment products, for instance, recorded net year-to-date (YTD) inflows of $350 million after bringing in $144 million last week. The fallback was noticeable since the same products witnessed a whopping $3 billion fund injection over Q1, 2021. Due to positive performance, the latter was a period that CoinShares experts described as “euphoric” for Bitcoin.

Similarly, products tracking lead altcoin Ethereum (ETH) exuded lagging inflows. Following a $23 million gain last week, the digital asset’s inflows recorded $111 million YTD net inflows. In comparison, Ethereum registered $705 million in inflows over the same period last year. CoinShares notes this difference, adding that it has happened despite the improvement in investor sentiment over the cryptocurrency.

Crypto investment products inflows indicate recuperation

But even then, the crypto market has continued to show signs of recovery after hits attributed to US Fed developments and the Russia-Ukraine conflict, among other events. Two weeks ago, investor sentiment grew optimistic, and the crypto market saw inflows rise to $193 million – the highest since mid-December 2021. At the time, lead digital asset Bitcoin continued to exude dominance in recovery, setting  $98 million in weekly inflows.

The latest update by CoinShares now shows an extended recovery, with crypto investment products registering inflows worth $108 million. Even more, the firm noted that the $193M inflows from two weeks ago now stood at $244 million following the incorporation of some late trade amounts. Additionally, total assets under management stood at $57 billion two weeks ago, a figure now revised to $61 billion. 

An excerpt reads:

Year-to-date net flows have now hit US$501m while total assets under management (AuM) have recovered to US$61 billion, the highest since the beginning of January 2022.

Regional disparities in investment figures

Furthermore, the firm points out the regional differences in investment amounts for crypto investment products. Two weeks ago, Europe led in inflows, with 76 percent of the total amount, or $147 million. Meanwhile, the Americas fell behind at $45 million, and some providers of such products registered minor outflows. 

The distinction is still present per the latest data, with Europe prevailing at 99 percent of inflows, while the Americas injected just $1.7 million.

Solana, which has made headlines in the past for large inflows into its investment products, is now the third-best performer. Following inflows of $8.2 million last week, its YTD now tops $100 million.