Cryptocurrency-based investment products recorded significant inflows for the second consecutive week following the U.S. Federal Reserve’s decision to cut interest rates last week. According to CoinShares data, major asset managers such as BlackRock, Bitwise, Fidelity, Grayscale, ProShares, and 21Shares experienced a combined net inflow of $1.9 billion into their products. This boosted the total assets under management within cryptocurrency investment products to $40.4 billion, marking the highest level this year.
Impact of Fed Rate Cut on Cryptocurrencies
James Butterfill, Head of Research at CoinShares, noted in their latest report that the Fed’s recent 25-basis point rate cut was initially perceived with caution. However, investor interest surged as the week progressed, resulting in $746 million being allocated to cryptocurrency-based investment products on Thursday and Friday alone. These flows indicate a potential total inflow of $48.6 billion by 2024.
Despite the growth in managed assets within investment products, the cryptocurrency market began the new week with a sharp decline. Over $1.7 billion, primarily in long positions, was liquidated, causing Bitcoin 
$78,318 to drop by 3% to $112,000 and Ethereum 
$2,399 to fall by 7.2% to $4,100.
Bitcoin-based investment products held the largest share, with a total inflow of $977 million, and saw $3.5 million outflow from short Bitcoin products. Spot Bitcoin ETFs experienced an inflow of $886.5 million, with BlackRock’s IBIT product alone receiving $866.8 million. Ethereum-based investment products reported a $772 million inflow, with $557 million coming from U.S. spot ETFs. Solana 
$88 products attracted $127.3 million, while XRP products saw a $69.4 million inflow.
Regional Distribution of Investment Products
US-based cryptocurrency investment products received a $1.8 billion inflow, making the US the leading region. Products in Germany attracted $51.6 million, while those in Switzerland and Brazil received inflows of $41.3 million and $9.3 million, respectively. Conversely, Sweden and Hong Kong saw outflows of $13.6 million and $3.1 million, respectively, diverging from the overall positive trend.
