In January, the price of most cryptocurrencies tumbled, with BTC dropping over 20% and ETH over 30% in a continued decline from all-time highs seen in November of last year. Over the decline, Bitcoin’s share of total assets held in cryptocurrency investment products rose to 69.5%.
According to CryptoCompare’s latest Digital Asset Management Review, macro sentiment around risk-assets has been the leading narrative in the markets, as following a record 7% CPI inflation figure coming out from the U.S. in December 2021 investors expect significant tapering of quantitative easing from central banks.
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The report details that assets under management for cryptocurrency investment products tumbled 25.1% from $58.6 billion to $43.9 billion, while average daily trading volumes fell 14.5% to $481 million. It adds that Bitcoin-based products saw their assets under management drop 23.3% to $29.9 billion, while Ethereum products and products backed by other assets saw more significant declines of 29.2% and 29.9% respectively.
As a result, BTC products gained market share, going from 67.8% to 69.5% in January.
According to the Digital Asset Management report, the third week of December was the first week since August where digital asset products saw outflows, with the trend carrying on into January. Bitcoin products have experienced the largest outflows with a weekly average of $49.3 million.