Bitcoin institutional inflows top $1B in 2023 amid BTC supply squeeze

Bitcoin (BTC) institutional investment vehicles have seen over $1 billion in new inflows in less than two months.

In its latest weekly report on Nov. 13, crypto asset management firm CoinShares furthered the narrative that Bitcoin and altcoins are again attracting capital.

Crypto institutional product AUM up 99% year-to-date

Bitcoin, Ether (ETH) and some major altcoins are enjoying price gains as excitement over the possible approval of the United States’ first spot exchange-traded fund (ETF) grows.

Since November 2022, the total crypto market cap has increased by $600 billion, data from TradingView confirms.

Total crypto market cap 1-week chart. Source: TradingView

The past two months, however, has seen a precipitous increase in funds being deployed to crypto investment products, CoinShares reveals.

“Digital asset investment products saw inflows totalling US$293m last week, bringing this 7-week run of inflows past the US$1bn mark, leaving year to date inflows at US$1.14bn, making it the third highest yearly inflows on record,” it summarized.

Among the impressive statistics showing crypto’s renaissance in 2023 is the assets under management (AUM) tally for crypto exchange-traded products (ETPs).

Since the start of the year, this has practically doubled, gaining nearly 10% in the past week alone.

“At US$44.3bn, total AuM is now the highest since the major crypto fund failures in May 2022,” CoinShares noted.

The report added that those aiming to long BTC had taken the lion’s share of volume.

“Bitcoin saw inflows totalling US$240m last week, pushing year-to-date inflows to US$1.08bn, while short-bitcoin saw US$7m outflows, indicative of continue positive sentiment,” it stated.

Crypto institutional inflows (screenshot). Source: CoinShares

“This is what adoption looks like”

The renewed interest meanwhile spurred on-chain analytics firm Glassnode to reassess Bitcoin supply dynamics.

Related: Funding rates echo $69K BTC price — 5 things to know in Bitcoin this week

With the next block subsidy halving just five months away, BTC being ferreted away for storage is now outpacing the amount mined by 2.4 times, it showed in the latest edition of its weekly newsletter, “The Week On-Chain.”

“The fourth halving event is fast approaching and represents an important fundamental, technical, and philosophical milestone for Bitcoin. For investors, it is also an area of intrigue given the impressive return profile in prior cycles,” it commented.

Among the various accompanying charts, one showed BTC supply storage by long-term holders, or LTHs — entities hodling coins for 155 days or more.

Bitcoin LTH supply storage chart (screenshot). Source: Glassnode

Continuing, Philip Swift, creator of statistics platform Look Into Bitcoin, highlighted increasing wallet entities both large and small.

“This is what adoption looks like,” he told X subscribers on the day.

This is what adoption looks like.#bitcoin

Free live chart: https://t.co/UjBDJtk5rT pic.twitter.com/twnAE8ZoC4

— Philip Swift (@PositiveCrypto) November 13, 2023

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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