Fund investments saw a significant decline in 2022, according to a new coinshares report. institutional investors, such as those using grayscale’s bitcoin trust or digital asset etps from 21shares, were involved in the decrease in inflows to crypto products, which totaled $433 million in 2022, a 95% decrease compared to 2021. the global crypto market cap also experienced a significant drop, starting the year at $2.3 trillion and ending it at $829 million, a loss of roughly 64% of the value.
November, short-investment product inflows represented 75% of the total inflows of $108 million for the year. assets under management dropped from $22.2 billion to $21.8 billion in assets held in exchange-traded crypto funds. this is a stark contrast to the inflows in 2021 and 2020, which totaled $9.1 billion and $6.6 billion respectively, and even further from the 2018 inflows of $233 million.
An asset is to bet against it and profit when (and if) the asset does, in fact, fall in price. short-investment products are still a “niche asset”, but investors can also hodl crypto assets directly. the coinshares fund flows report specifically tracks activity in exchange-traded products, which is why the decline in crypto fund investments was noticed. the decrease in inflows is likely due to the decrease in the global crypto market cap and the decreased interest in crypto products from institutional investors.