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Market Minute: Ethereum investment products lead July gains

Ethereum-based investment products have been leading the bounce-back in the second half of the year

To put it nicely, it has been a turbulent first half of the year, with the digital assets declining along with other risk assets in the financial markets. And this misery was compounded by the contagion effects that we saw emerge in the second quarter of 2022 — UST collapse, macroeconomic conditions & extreme liquidity crunch contributed to worsening conditions in the Cryptoverse.

A recent report by CryptoCompare sheds light on how the digital assets performed in the month of July. Let’s give you the bad news first, according to the monthly review published — Average daily volumes across all digital asset investment products are still significantly below the levels seen in 2021 (lower chart above), with average daily volumes falling 44.6% to $122 million in July. This is the lowest average daily volume recorded since September 2020.

Now, let’s review the silver lining — the month of July has seen all the digital investment products covered in the report posting positive returns. This is an encouraging reversal from June when only 21Shares Short Bitcoin ETP posted growth. And leading these gains have been Ethereum-based products (top chart above). ETH products have seen gains ranging from 25.9% to 37.8%, whilst Ethereum itself experienced 30-day returns of 13.6% (as of July 26th).

Nothing in cryptocurrencies is complete without mentioning Bitcoin. The pioneering crypto assets under management (AUM) rose 16.9% to $18.6 billion in July, however, it fell in market share, currently at 69.9% of total AUM, down from 73.6% in June. Ethereum’s AUM rose 44.6% to $6.57 billion while ‘Other’ and ‘Baskets’ AUM rose 21.8% to $1.0 billion and 19.6% to $404 million, respectively.

At the time of publishing, ETH was trading close to $1700 while BTC was trending close to $23.7k, as we see the short-term bullish bias holding in the cryptos — helped along by the bullish sentiment in other risk assets.

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Read more stories like this and others by Faisal Khan on Medium.

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