Bitcoin ($BTC) and Ethereum ($ETH) Investment Products Lose AUM in May, But Some Asset Managers Thrive

May was the first month of 2023 that saw a decline in the assets under management (AUM) of both Bitcoin ($BTC) and Ethereum ($ETH) investment products, which dropped 10.3% and 4.42% respectively, resulting in values of $21.7 billion and $7.50 billion.

Other digital assets and mixed asset baskets followed suit, declining 12.04% to $958 million and 8.09% to $434 million, respectively. Despite this setback, certain digital asset management firms have displayed robust year-to-date (YTD) performance, with notable increases in assets under management

According to CCData’s latest Digital Asset Management Review report, CI Galaxy has emerged as the frontrunner this year, with a remarkable 118% increase in AUM. Not far behind are ProShares and ETC Group, boasting an 80.1% and 71.5% increase in AUM, respectively.

The report also noted a shift in market share dynamics between Bitcoin and Ethereum. The decline in Bitcoin and Ethereum products in May led to a decrease in Bitcoin’s market share from 72.0% to 70.9%. Interestingly, Ethereum saw an increase from 23.4% to 24.5%, indicating a potential shift in investor sentiment toward Ethereum-based products.

As CryptoGlobe reported global asset manager VanEck has recently published a valuation model for Ethereum, the world’s second-largest cryptocurrency by market capitalization, predicting a potential price rise to $11.800 by 2030.

This prediction comes in light of Ethereum’s recent hard fork, which allows users to withdraw staked ETH, which they believe could rival US T-bills. Ethereum’s network revenues are projected to increase from an annual rate of $2.6 billion to $51 billion in 2030, assuming it captures 70% of the market among smart contract protocols, which implies the $11,800 price by 2030.

VanEck, another player in the digital asset market, recorded the highest increase in AUM in May, rising 2.25% to $334 million. CI Galaxy, despite its overall success this year, saw a decrease of 3.45% to $523 million. Grayscale, a dominant player in the market, retained its position with products recording a total AUM of $23.0 billion.

An observed trend has been the decline in average daily aggregate volumes of digital asset investment products for the third consecutive month in May, with a significant decrease of 24.6% to $209 million.

Despite the dip, the overall performance of digital asset management firms this year has been positive. The robust increases in AUM indicate a growing confidence in digital assets as an investment option. However, the decline in Bitcoin’s market share could signal a shift towards other digital assets, like Ethereum.

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