Solana Dominates Institutional Investors’ Preferences Amid Bitcoin and Ethereum Outflows
Digital asset investment products saw a second consecutive week of outflows, with a significant $726 million exiting the market. The outflows were particularly concentrated in Bitcoin and Ethereum, coinciding with a lack of bullish momentum in their spot prices. However, amidst this trend, Solana-based investment products have been defying the broader market movement.
Solana has emerged as a favorite among institutional investors, attracting inflows for the second week in a row. CoinShares’ latest weekly report highlighted that Solana-based investment products received $6.2 million in inflows last week, bringing the year-to-date total to $47 million. While these figures may seem modest compared to other digital asset products, their significance is heightened due to the prevailing bearish sentiment in the crypto industry.
The negative sentiment in the market has largely been influenced by investor expectations regarding the U.S. Federal Reserve’s monetary policy. Anticipation of a 25 basis point interest rate cut following strong macroeconomic data has led to substantial outflows from digital asset products, with the United States witnessing a withdrawal of $721 million and Canada experiencing $28 million in outflows.
Bitcoin and Ethereum faced significant outflows, with Bitcoin ETFs consistently registering outflows throughout the week. Bitcoin products saw $643 million exiting the market, while Ethereum also experienced outflows, largely driven by the Grayscale Trust. In contrast, a few other digital assets managed to attract modest inflows, including multi-asset products, XRP, and Litecoin.
Despite the overall outflows, Europe ended the week with positive inflows, with Germany and Switzerland leading the way with $16.3 million and $3.2 million in inflows, respectively. Australia and Brazil also saw inflows into their digital asset markets, indicating regional variations in investor sentiment.
The data reflects a nuanced picture of the digital asset investment landscape, with Solana standing out as a resilient performer amidst market turbulence. As institutional investors navigate the evolving crypto market dynamics, the coming weeks will be crucial in determining the trajectory of digital asset investments.