Home
News
- 1 The crypto market reported positive momentum that led to capital flooding in investments.
- 2 Even after the capital influx in the crypto market, the trading volumes still remain relatively low.
- 3 Bitcoin (BTC) saw an uptick in inflows yet outflows remained higher in the past; Solana (SOL) took the lead among altcoins for inflows.
Outflows and inflows in financial markets are yet another phenomenon considered to recognize the investors’ interest. Cryptocurrencies also see inflows and outflows depending on market and macroeconomic conditions. Recently, crypto investment products reported to see capital flooding in the wake of some positive momentum in digital asset prices.
Capital market company, CoinShares shared a blog post titled Digital Asset Fund Flows. It consists of a report highlighting the weekly data of overall inflows and outflows in the digital assets. The report found that the broader market was witnessing outflows for a long time this year but the trend changed last week.
The recent influx of capital in the cryptocurrency market primarily occurred towards the end of the past week. This uptick in investment activity can be attributed to a confluence of factors, as explained by James Butterfill from CoinShares.
These factors include positive price momentum in the cryptocurrency market, concerns regarding the prices of U.S. government debt, and the ongoing challenges related to government funding. These elements combined to drive increased interest and investment in cryptocurrencies during this particular period.
Despite the recent influx of capital in the cryptocurrency market, trading volumes for cryptocurrency investment products have remained relatively low, in line with seasonal trends observed in the broader cryptocurrency market.
Notably, Bitcoin investment products recorded inflows of $20.4 Million over the past week, a positive shift after experiencing outflows exceeding $100 Million in the last month. This suggests a degree of cautiousness or reduced activity among investors, even as capital flows into specific cryptocurrencies show signs of recovery.
Altcoins Broadly Remained Neutral, Except for Solana
CoinShares has observed that there has been limited activity in the altcoin space recently. However, the cryptocurrency Solana has continued to stand out with $5 Million in inflows.
This marks Solana’s 27th week of experiencing capital inflows, with only four weeks of outflows recorded in 2023. Solana’s consistent appeal to investors sets it apart as a notable exception amid the relatively subdued altcoin market activity.
The second-largest cryptocurrency by market capitalization, Ethereum ($ETH) experienced outflows worth $1.5 Million during the past week. Similarly, investment products concentrating on multiple cryptocurrencies recorded outflows amounting to $1.4 Million within the same timeframe.
In the context of this year, Ethereum has witnessed significant outflows amounting to $114 Million, while multi-asset products have seen $27 Million in outflows. In contrast, Solana has attracted $31 Million in inflows, highlighting its relatively stronger appeal to investors as compared to Ethereum and multi-asset products.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
