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- Interest in cryptocurrency investment products began to fade in July when the price of bitcoin (BTC, +0.49% ) fell below the $30,000 level
- According to the study, total assets under management across exchange and over-the-counter digital asset investment products have dropped by 14% to $34.8 billion since June
- Grayscale’s bitcoin trust product (GBTC) maintained a 59.1 percent share of trust product volume. However, GBTC’s average daily volume was down 37% to $160 million
In July, when the price of bitcoin (BTC, +0.49% ) dropped below the $30,000 mark, interest in cryptocurrency investment products began to wane. The fall in trading activity and total assets under management (AUM) in the digital asset investment arena is highlighted in a new study from CryptoCompare. According to CryptoCompare, digital asset markets still have a long way to go before more risk-averse investors are totally at ease when compared to traditional asset classes.
According to the study, total assets under management across exchange and over-the-counter digital asset investment products have dropped by 14% to $34.8 billion since June. According to the study, grayscale products account for the great bulk of AUM, accounting for $27.9 billion (80.1 percent of total), followed by those of XBT Provider ($2.7 billion, 7.8% of total) and 21Shares ($949 million, 2.7% of total). The research also showed that investment product trading activity slowed further in July, with aggregate daily volumes of $319 million, down 35% from June levels. Grayscale’s bitcoin trust product (GBTC) maintained a 59.1% share of trust product volume. However, GBTC’s average daily volume was down 37% to $160 million.
Despite a reduction in trading activity and a decrease in AUM, net investment flows improved in July. In comparison to net outflows of $59.5 million in June, net inflows climbed to $58.5 million. Although the market value of cryptocurrencies has dropped by more than 40% since its peak of $2.5 trillion in early May, institutional investors continue to pour money into space. Despite the fact that Bitcoin (BTC) has lost more than half of its US dollar value and altcoins have lost almost 70% of their value, big-money investors such as hedge funds are still investing in digital currencies.
Institutional investors are expanding their footprint in the cryptocurrency and blockchain industry, from direct exposure to crypto to supporting businesses developing digital asset goods and services. Crypto rules appear to be taking shape in many jurisdictions as regulated businesses continue to investigate digital currency investment opportunities. Meanwhile, regulators in the United States, such as the Securities and Exchange Commission, are under intense pressure to create a more stringent regulatory framework for cryptocurrencies.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
