Bitcoin accounts for 97% of total cryptocurrency inflows in 2021

Bitcoin trading volume has surged this year , soaring to $12 billion from an average of $2 billion in 2020.

Bitcoin ( BTC) , the world’s largest cryptocurrency by market value, remains the most popular digital currency among investors , a new report shows .

A report from digital asset investment firm CoinShares on January 25 showed that Bitcoin's capital inflows accounted for 97% of the total cryptocurrency capital inflows so far in 2021.

Bitcoin accounts for 83% of digital asset investment products, which account for only 6.5% of total Bitcoin trading volume. During the cryptocurrency bull run in January, Bitcoin's daily trading volume has surged so far this year, increasing from an average of $2.2 billion in 2020 to $12.3 billion this year.

CoinShares noted that inflows into crypto investment products hit a record $1.3 billion in the past week, following a period of minor outflows. CoinShares added: “We believe investors have been very price sensitive this year due to the speed at which Bitcoin has reached new highs.”

Data from CoinShares shows that Ethereum ( ETH) , the second-largest cryptocurrency, has seen $34 million in inflows over the past week. CoinShares’ latest report notes that “there has been virtually no inflows into Ethereum since early December” as investors have been cautious.

Both Bitcoin and Ethereum have hit new all-time highs in 2021. Bitcoin surpassed its all-time high of $42,000 on January 8, followed by Ethereum reaching its all-time high of $1,430 on January 19. Both cryptocurrencies have experienced huge price corrections, with Bitcoin falling below $30,000 and Ethereum falling to around $1,000 on January 21.

According to CoinShares, recent comments from U.S. Treasury Secretary Janet Yellen are partly responsible for the recent price drop. On January 19, Yellen expressed concerns about cryptocurrencies, claiming that they are often used for illegal financing. However, she noted that cryptocurrencies have some potential to improve the financial system. (Cointelegraph)