Solana is investors’ new favorite digital asset as BTC weekly outflows linger – CoinShares

  • Digital asset Solana has experienced the biggest inflows ($7.1M) the past week showing positive investor sentiment.
  • Bitcoin recorded outflows of $2.8M last week, marking its 7th consecutive week of outflows.

Institutional investors have turned their attention to Solana (SOL) in the past few week, according to CoinShares. According to CoinShares’ “Digital Asset Fund Flows Weekly” report for the week ending Aug. 20, Solana experienced $7.1M inflows. This was the largest figure of inflows recorded last week, covering exchange-traded products (ETPs), mutual funds, and over-the-counter (OTC) trusts referencing Bitcoin and altcoins. A third of the total inflows to crypto investment products are being used to acquire Solana tracking instruments.

Of note, SOL has surged 110 percent from $35.58 at the start of the month to $77.50 as of this writing, our data shows.

As James Butterfill writes in the recent report, institutional crypto investment products have gone against a six-week trend of outflows. Last week was marked by digital asset fund inflows of roughly $21 million. 

Crypto market beside Solana

Cardano (ADA) tracking products were second-most popular with inflows of $6.4M.  Other altcoins such as Ethereum (ETH), Litecoin (LTC), and Polkadot (DOT) saw minor inflows of $3.2M, $1.8M, and $1.1M respectively. 

The largest digital asset by market cap, Bitcoin (BTC), saw its 7th consecutive week of outflows totaling $2.8M. 

Over the same period, reclaimed its $50,000 position a few hours ago, before correcting to its current price. BTC shaved off 2 percent and is trading at $49,624 at writing time.  

As for digital asset investment products, last week saw net inflows of $21M after six successive weeks of outflows. This indicates improved investor sentiment. 

Additionally, the recent market rally has increased total assets under management (AUM) by crypto investment product issuers to $57.3 billion. This is the highest since the mid-May market bull market heights when the same figures peaked at around $66 billion. Leading institutional digital asset manager Grayscale takes up 75 percent of the total AUM with $42.6 billion.

Institutions continue to have significant exposure to cryptocurrency investments. Institutional exposure could rise in the short term if the bullish case for the four-year market cycle is validated.

Mixed flows across asset providers

Even though BTC outflows may suggest negative market sentiment, it masks quite mixed flows across providers. This is because while some product providers posted outflows for the past week, others from North America and Europe posted inflows.

Notably, CoinShares XBT, ETC Issuance funds had outflows of $9.5M and $9.4M. Differently, 21shares, CoinShares Physical and 3iQ posted inflows of $21.8M, $14.7M, and $10.8M respectively. Butterfill notes, “We believe this indicates the beginning of a turn in sentiment for digital assets.”

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A financial analyst who sees positive income in both directions of the market (bulls & bears). Bitcoin is my crypto safe haven, free from government conspiracies. Mythology is my mystery! "You cannot enslave a mind that knows itself. That values itself. That understands itself.”

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