A recovery in capital flows into crypto investment products translated into little price action, even as investment products saw their first inflows in five weeks.
Bitcoin slipped 1.3% over the past 24 hours to $61,856.1 by 07:35 ET (11:35 GMT).
The world’s biggest cryptocurrency took limited support from data showing that crypto investment products- specifically spot Bitcoin exchange-traded funds- saw their first weekly capital inflows in five weeks.
Data from digital assets manager CoinShares showed crypto products saw inflows totalling $130 million in the week to May 12, with a bulk of these directed towards the U.S..
The launch of spot Bitcoin ETFs in Hong Kong also sparked some inflows.
But despite the improvement in capital flows, overall trading volumes in crypto investment products remained largely dismal, staying well below highs seen in March when Bitcoin hit a lifetime peak.
The world’s largest cryptocurrency settled into a slim trading range between $60,000 and $70,000 over the past two months, as a mix of interest rate fears, regulatory uncertainty and waning ETF hype spurred little actual price action. The token’s hotly anticipated halving event also landed with a thud.
Broader crypto markets also tracked Bitcoin higher on Tuesday. World no.2 token Ethereum slid 1.9% to $2,906.85, while Solana added 0.4% and XRP remained flat.
Memecoins saw some better gains, tracking an overnight rally in meme stocks such as GameStop Corp (NYSE:NYSE:GME) and AMC Entertainment Holdings Inc (NYSE:NYSE:AMC) on Wall Street. Dogecoin rose more than 5%, while newer memecoin PEPE added over 20%.
Still, overall crypto prices remained largely subdued in anticipation of key U.S. inflation data this week.
Producer price index inflation data is due later on Tuesday, while the more closely-watched consumer price index inflation data is due on Wednesday.
Both readings are widely expected to factor into the outlook for U.S. rates, and come amid persistent concerns that rates will remain high for longer.
The prospect of high U.S. rates bodes poorly for crypto markets, given that they usually thrive in low-rate, high-liquidity markets.
An upcoming U.K. election is unlikely to derail progress in crypto regulation, industry stakeholders said in an interview with CoinDesk.
Although an election date hasn’t been announced, it is expected to happen later this year.
The ruling Conservative party, in power since 2010, has introduced several crypto measures, aiming to make the U.K. a crypto hub since 2022. They have introduced a market bill enabling the Financial Conduct Authority (FCA) to regulate crypto as a financial activity.
The Conservatives have also promised legislation for stablecoins and staking before the next election, a goal many believe is achievable.
Adam Jackson, director of policy at Innovate Finance, said that the country needs secondary legislation to formally task the FCA with regulating crypto, including stablecoins.
“That’s what the government said they would do,” Jackson told CoinDesk. “We haven’t heard otherwise as to why that’s not feasible. So all things being equal they should have those powers by the time of the national election.”
Source: Cryptocurrency - investing.com
