Following a brutal second quarter for the crypto markets this year, institutions are returning to the game. According to the most recent CoinShares report, institutional monthly inflows into crypto funds remained the highest in 2022 during the last month of July.
In July, total monthly inflows were R7.8 billion. This has completely compensated for the R 7.9 billion in net June outflows. Despite the macro headwinds, cryptocurrencies are putting on a strong performance as the month of August approaches.
Net inflows into digital asset investment products totaled R1.3 billion last week. This was the fifth week of inflows following the crypto winter of Q2 2022. Over the five weeks, net inflows totaled R8.7 billion, or 1.6% of total assets under management (AuM).
Last week, net inflows into Bitcoin investment products totaled R1.4 billion. Short Bitcoin outflows, on the other hand, totaled R43 million. This was also Bitcoin’s first week of outflows after five weeks of net inflows.
Solana, Ethereum’s Layer-1 competitor, also saw a minor inflow of R24.8 million. Furthermore, SOL has remained an investor favourite in 2022, with year-to-date inflows of R1.8 billion. Furthermore, CoinShares explains:
Outflows from multi-asset investment products totalled R61 million for the second week in a row, indicating that investors are becoming more selective in their investments.
However, CoinShares cautions investors to be cautious at this time. It observes that, despite the strong bullish momentum, overall trading activity is still low. Last week, total crypto trading volumes were R21.5 billion, compared to this year’s weekly average of R39.8 billion.
The cryptocurrency market is expected to remain volatile in August. With the optimism surrounding The Merge upgrade, altcoins had a strong rally last month, led by Ethereum.
Bitcoin gained more than 18% in the previous month. It will be interesting to see what happens in August.