Investors in the cryptocurrency universe went scrambling after the dramatic crash of the stablecoin TerraUSD[1]. This sudden fall triggered a sell-off and chaotic situation within the crypto market. Despite the traumatic turn of events, investors may still have faith in digital assets as digital asset investment products are witnessing inflows.
Year’s highest inflows
Last week, digital-asset funds netted their highest inflows since late 2021 as investors bought into market panic as per the latest Digital Asset Fund Flows weekly report[2]. Coinshares[3] stated that digital asset investment products saw record weekly inflows for this year, summing up to $274 million as of last week. This is the highest level since the start of 2022.
Source: CoinShares[4]
Given the distress caused by the UST fiasco, investors saw the associated broad sell-off as a buying opportunity. Consider this: UST, the stablecoin at the epicenter of this recent price correction, saw the AuM fall by 99% over the week. Despite this, some intrepid investors added $0.043 million to positions.
Geographically, North American investors saw inflows of approximately $312 million. On the contrary, European investors carried a polarized sentiment but in aggregate witnessed outflows of $38 million in totality.
Brick-by-brick
Bitcoin[5] remained the primary benefactor, with inflows of $299 million last week, suggesting that investors were flocking to the relative safety of the largest digital asset. In fact, Short-Bitcoin[6] (selling coins) saw minor inflows of $0.7 million, which is a slow-down from previous weeks.
Source: CoinShares
