Crypto Inflows Surge to $407M Ahead of U.S. Elections

Global crypto investment products recorded $407 million in inflows, largely influenced by the upcoming U.S. elections rather than monetary policy, analysts at CoinShares say.

Asset managers such as BlackRock, Fidelity, and Grayscale, among others, experienced a robust inflow of $407 million. This signals a shift in investor focus from traditional monetary policy considerations to the upcoming U.S. elections. CoinShares head of research James Butterfill noted this in a blog report on Monday, Oct. 14.

The data reflects growing optimism surrounding political developments, particularly as the recent vice presidential debate and a polling shift favoring Republicans sparked renewed interest. Republicans are often viewed as more supportive of crypto.

“This trend is evident in the fact that stronger-than-expected economic data had little impact on stemming outflows.”

As anticipated, Bitcoin garnered the most inflows at $419 million, positioning it as the primary beneficiary of these political shifts. Meanwhile, Ethereum “resumed its trend of outflows” with a total of $9.8 million last week, Butterfill says.

Investment Trends and Insights

Short-Bitcoin investment products also faced outflows totaling $6.3 million, highlighting a clear divergence in investor sentiment. Despite stronger-than-expected economic data, which typically influences market behavior, this time it had little effect on stemming outflows from other asset classes. The concentration of inflows in crypto seems to demonstrate a changing narrative where investors prioritize political events over economic indicators.

Geographical Contributions

The U.S. accounted for a substantial $406 million of the inflows, with Canada contributing a modest $4.8 million. Multi-asset investment products continued their upward trajectory with a 17th consecutive week of inflows, albeit at a minor $1.5 million.

Butterfill noted that blockchain equity exchange-traded funds saw “one of the largest weekly inflows this year,” allocating $34 million, likely fueled “in response to recent Bitcoin price rises.”

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