Investors Might be “Rotating” Out of Gold and into Bitcoin (BTC), Digital Asset Flows Data from CoinShares Suggests

London-based CoinShares, a company that aims to expand access to the digital asset ecosystem while serving as a trusted partner for its clients, has noted that the Bitcoin (BTC) price has been closing-in on the “very psychological” all-time-high (of nearly $20,000) “coupled with momentary fears of greater regulatory scrutiny” in the United States.

According to the CoinShares team, these factors are “the most likely reasons for the sell-off in Bitcoin last Thursday.” But the Bitcoin price has already recovered (at the time of writing) with BTC currently trading at over $19,500+ while also setting a new all-time high.

As noted in CoinShares’ recent digital assets fund flows report:

“For the first time since early October 2020, [these recent Bitcoin price movements and sell-off] prompted a day of minor outflows from Bitcoin investment products totalling $3 milion. Flows then bounced back with an inflow of US$48m on Friday (November 28, 2020) bringing the week’s total flows to an inflow of US$198m.”

CoinShares’ report also mentioned that “volumes last week were 150% above the year daily average, trading at US$5bn a day on trusted exchanges, with investment products representing 12%, the highest since 2017.”

According to CoinShares, this type of activity “suggests the investment market saw the weakness in prices as a buying opportunity, shrugging-off the regulatory fears.”

The CoinShares team added:

“We believe the weakness in the US dollar has supported the inflows into Bitcoin investment products, as investors look for an anchor while fiat currencies continue to be debased by central banks. Fund flow data from gold investment products unusually highlight outflows during this dollar weakness. Although it is hard to find direct evidence, the flows data may suggest that investors are rotating out of gold and into Bitcoin. Volumes last week were 150% above the year daily average, trading at US$5bn a day on trusted exchanges.”

Going on to share the year-to-date (YTD) flows at other digital asset firms, CoinShares noted that 21Shares has seen net YTD flows of $64 million and has $191 million worth of assets under management (AUM).

Meanwhile, Grayscale has seen YTD flows of over $3.8 billion and now manages more than $10.6 billion of client assets. ETC Issuance has reported $123 million in YTD flows and $173 million in AUM.

WisdomTree reported $63 million in YTD flows and $85 million in AUM. CoinShares reports $29 million in YTD flows and over $1.4 billion in AUM.

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