Citi noted that exchange-traded funds (ETFs) for Bitcoin (BTC) and Ethereum (ETH) have experienced significant inflows. Since their inception, spot Bitcoin ETFs have amassed net inflows totaling $39.5 billion, with a noticeable increase following the U.S. presidential election in November 2020. These inflows have been influential, accounting for approximately 42% of the variance in Bitcoin's weekly price movements since January.

U.S. equities have recently played a substantial role in the dynamics of cryptocurrency markets. Similarly, ETH ETFs have seen a positive trend in net inflows, accumulating $2.8 billion since their launch in July. This uptick in ETH ETF investments also coincided with the post-election period.

Citi highlighted that both on-chain and off-chain metrics for cryptocurrencies appear constructive. The combined volumes of spot and futures trading for Bitcoin have remained high. Additionally, there has been a resurgence in search interest for cryptocurrencies, which had previously peaked around the time of the U.S. presidential election.

The market capitalization of stablecoins has seen a sharp increase, and the volume of transactions on decentralized exchanges is near record highs, suggesting robust activity in the crypto space.

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