As Bitcoin, Ethereum Outflows Rock, Institutional Investors Favor Solana
Solana seems to be defying a second week of digital asset investment product outflows. Last week saw $726 million in bitcoin investment product outflows.
Bitcoin and Ethereum, two of the major cryptocurrencies, had the highest outflows, which matched their spot price underperformance. Solana-based investments have defied the market.
Institutional Investors Favor Solana
Solana has had inflows for two weeks, indicating investor confidence. CoinShares' latest weekly report on digital asset investment funds shows Solana-based products received $6.2 million last week, pushing their year-to-date inflows to $47 million.
Inflow statistics may be small compared to digital asset investment products, but timeliness has made them more crucial. The whole crypto market has been plagued by gloomy sentiment in recent weeks, which has been mirrored in institutional investors, so much so that digital asset product outflows have equaled March's record.
Investor expectations about the U.S. Federal Reserve's monetary policies have generated this negative mood, according to CoinShares. Market investors predict a 25 basis point (bp) interest rate drop after stronger-than-expected macroeconomic data last week. Thus, $721 million was withdrawn from digital asset investment products in the US. Canada followed with $28 million outflows.
Spot Bitcoin ETFs saw outflows every day last week, therefore Bitcoin had the most outflows. Bitcoin investment products lost $643 million. Ethereum also suffered. The newly introduced Spot Ethereum ETFs, notably Grayscale Trust, drove outflows. Ethereum investment products lost $98 million as investor interest declined and market fears increased.
Despite the trend, certain digital assets saw minor inflows. Multi-asset goods received $3.4 million, XRP $1 million, and Litecoin $0.7 million. Short Bitcoin instruments, which gain from falling prices, had $3.9 million inflows, highlighting Bitcoin's pessimistic attitude.
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