James Butterfill, Investment Strategist at London-based CoinShares, a digital asset manager focused on expanding access to the cryptocurrency ecosystem while serving as a “trusted partner” for its clients, notes that for the week ending December 31, 2021, the firm saw yearly inflows of “US$9.3bn in 2021 versus US$6.8bn in 2020.”
Digital asset investment products saw inflows “totaling US$9.3bn in 2021, a 36% increase from 2020.”
CoinShares further noted:
“While the increase from 2019 to 2020 was significantly higher at 806%, we believe this represents a maturing industry, with total assets under management (AuM) ending the year at US$62.5bn in 2021 versus just US$2.8bn at the end of 2019.”
The final week of 2021 “saw a third week outflows totaling US$32m, with the trend suggesting diminishing outflows following the record weekly outflows mid-December.” Total outflows for the 3 weeks now “total US$260m 0.4% of AuM,” the report from CoinShares revealed.
The firm added that Bitcoin saw “total 2021 inflows of US$6.3bn versus US$5.4bn, a year-on-year increase of only 16%, where there was the lowest growth in inflows relative to other digital asset investment products.”
Ethereum saw inflows “double from US$920m in 2020 to US$1.3bn in 2021 although in the most recent round of negative sentiment has seen 4 weeks of outflows totaling US$161m.”
The company also mentioned that the total number of coins in investment product form has “expanded from 9 to 15.” And 37 investment products were “launched in 2021 versus 24 in 2020 and now total 132, indicative of the demand and popularity of digital assets.”
As covered recently, CoinShares noted in an extensive report that advances in quantum computing are “stoking fears” that Bitcoin’s wallet structure is “vulnerable to exploits, theoretically undermining its security.”
The team at CoinShares pointed out that using quantum technologies to exploit the Bitcoin protocol is “theoretically possible.” But it’s “exceptionally difficult to do in practice.”
In order to mitigate against such attacks, “a soft fork with a commit–delay–reveal scheme could be implemented,” according to the update from CoinShares.