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Digital Asset Investments Surge Due to Bitcoin’s Decline

Jul 8, 2024 at 03:34

CoinShares reported significant inflows of $441 million into digital asset investment products over the past week, largely attributed to Bitcoin price weakness, Mt. Gox activity, and a German government sell-off.

The July 8 CoinShares report indicated that Bitcoin saw $398 million in inflows. The drop in Bitcoin prices, along with activity from the defunct Mt. Gox exchange and German government sales, likely spurred investor buying sprees.

The majority of these inflows occurred in the United States, with $384 million, followed by Hong Kong ($32 million), Switzerland ($24 million), and Canada ($12 million). In contrast, Germany experienced $23 million in outflows.

The previous week was notable for Mt. Gox, the Japanese crypto exchange that collapsed. On July 5, it transferred over 47,000 BTC, valued at approximately $2.7 billion at the time, to an unknown wallet as part of its repayment plan to creditors.

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Repayments began simultaneously in Bitcoin and Bitcoin Cash to select creditors via designated cryptocurrency exchanges, as outlined in Mt. Gox’s rehabilitation plan. Creditors needed to verify account validity and accept the Agency Receipt Agreement through these exchanges.

Analysts speculate that many of Mt. Gox’s creditors might sell their Bitcoin, given its 8,500% increase in value since the exchange’s collapse.

During the same week, the German government transferred 3,000 BTC, valued at around $172 million at the time, to various crypto exchanges and an unknown wallet.

The CoinShares report also emphasized Bitcoin’s $398 million inflows, making up roughly 90% of the total, as investors showed interest in a broader range of altcoins.

Solana received $16 million in inflows over the past week, making it the “best-performing altcoin” with $57 million year-to-date. Ether saw $10 million in inflows.

Additionally, the Sentinel Action Fund doubled its Solana donations to a pro-crypto political action committee, which supports four pro-crypto U.S. Senate candidates.

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