The cryptocurrency market is riding a wave of bullish momentum, with $3.2 billion in inflows recorded last week. According to the latest CoinShares report, this marks the 10th consecutive week of positive inflows, setting a record for the longest streak in 2024.
A significant factor behind the surge is Donald Trump’s recent presidential election victory, which has boosted investor confidence in a more crypto-friendly regulatory environment under the new administration.
Bitcoin Takes Center Stage: $2 Billion in Weekly Inflows
Bitcoin continues to dominate the market, accounting for $2 billion of the weekly inflows. Since Trump’s win in November, Bitcoin-related investment products have seen a staggering $11 billion in inflows.
“The strong post-election momentum reflects optimism for regulatory clarity and institutional adoption under the incoming administration,” said James Butterfill, Head of Research at CoinShares.
The U.S. market led the way, contributing $3.1 billion to the total inflows, followed by Switzerland ($36 million), Germany ($33 million), and Brazil ($25 million).
Bitcoin trading volumes on trusted exchanges also reached impressive levels, with $8.3 billion traded daily. This liquidity underscores the market’s strength as Bitcoin’s price hit an all-time high of over $106,000.
Ethereum Maintains Positive Streak
Ethereum is not far behind, recording its seventh consecutive week of inflows. Over the reporting period, Ethereum investment products saw an additional $1 billion, bringing total inflows to $3.7 billion this year.
Spot Ethereum ETFs also saw a surge, maintaining a 15-day streak of inflows totaling over $2 billion. This highlights the growing confidence in Ethereum’s utility and market potential.
Altcoins See Diversified Gains
While Bitcoin and Ethereum dominate, altcoins have also enjoyed positive momentum:
- XRP: $145 million in inflows, driven by speculation about a U.S.-listed ETF.
- Polkadot: $3.7 million in inflows, reflecting its growing appeal among developers and investors.
- Litecoin: $2.2 million in inflows, as investors diversify their portfolios.
The altcoin rally suggests that investors are increasingly looking beyond Bitcoin and Ethereum for opportunities, particularly in assets with unique use cases or potential for regulatory breakthroughs.
Short Bitcoin Products and Hedging Strategies Gain Traction
Interestingly, short Bitcoin products also saw $14.6 million in inflows last week, pushing their assets under management to $130 million. This trend indicates that some investors are adopting hedging strategies, even as Bitcoin’s price continues to soar.
Butterfill noted that this dual trend reflects a mature market, where investors are exploring ways to manage risk while participating in the broader rally.
Crypto Market Overview
At the time of writing, the total cryptocurrency market is valued at $3.65 trillion, with Bitcoin’s dominance standing at 56.29%. The 24-hour trading volume across all assets reached $172.84 billion.
Key metrics:
- Bitcoin: Market cap of $2.05 trillion, trading at $103,761.32 (up 0.89%).
- Ethereum: Riding consistent inflows with a focus on institutional adoption.
Regulatory Optimism Underpins Growth
Trump’s election victory has injected fresh optimism into the crypto sector, particularly regarding potential regulatory clarity. Investors anticipate a more accommodating approach from the new administration, which could pave the way for broader institutional adoption.
This optimism has also been bolstered by growing confidence in exchange-traded products (ETPs), which now account for 30% of Bitcoin trading activity on trusted platforms.
Altcoins Poised for Further Growth
With rising speculation about altcoin ETFs and increasing institutional interest, assets like XRP, Polkadot, and Litecoin are expected to remain in focus. Analysts predict that the diversification of crypto portfolios will accelerate as investors seek exposure to a wider range of digital assets.
Challenges and Risks Ahead
Despite the positive trends, the crypto market faces several challenges:
- Regulatory Uncertainty: While optimism is high, the specifics of the new administration’s policies remain unclear.
- Market Volatility: The rapid rise in asset prices could lead to corrections, particularly if external factors like global economic instability come into play.
- ETP Reliance: The heavy concentration of activity in ETPs raises questions about liquidity and market resilience outside these products.
Looking Ahead
As the crypto market continues its historic rally, the coming months will be pivotal. With total year-to-date inflows reaching $44.5 billion—four times higher than any previous annual record—the sector is poised for further growth.
Investors will be closely watching regulatory developments under the Trump administration, particularly concerning Bitcoin ETFs and broader market infrastructure. Meanwhile, the performance of altcoins and Ethereum’s ongoing momentum suggest a diversified market poised for long-term gains.
The crypto market’s resilience and adaptability underscore its growing maturity, setting the stage for a transformative 2025.
