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Crypto Funds See Largest Inflow in 15 Months, With Bitcoin, Solana Leading Rally: CoinShares
Ether-based funds continue to fall out of favor, with outflows for the year now totaling $125 million.
Updated Oct 30, 2023, 4:01 p.m. Published Oct 30, 2023, 4:01 p.m.
Crypto-focused investment funds enjoyed $326 million of net inflows last week, the largest single-week influx since July 2022, digital asset investment firm CoinShares reported Monday.
The key reason behind the move, according to CoinShares, is the rally in prices fueled by growing optimism the U.S. Securities and Exchange Commission (SEC) will approve the first spot bitcoin exchange-traded fund (ETF).
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"We do believe a spot-based ETF is now highly likely in the coming months, and will represent a step-change for the industry from a regulatory perspective," said James Butterfill, CoinShares head of research.
CoinShares, however, did note that last week's inflows – while sizable – were only the 21st largest weekly gain over the three years the company has been keeping a record of such data, indicating that investors might still be somewhat cautious about deploying capital.
Bitcoin, solana (SOL) funds gain, ether (ETH) lags
Bitcoin funds were responsible for 90% of all inflows, including $15 million to short-bitcoin funds – i.e., those that would profit from a decline in prices – indicating some are hedging their gains or outright betting that prices could soon reverse.
Solana [SOL] investment vehicles extended their winning streak with $24 million of net inflows, the largest among altcoins.
Funds holding ether [ETH] continued to fall out of favor, suffering $6 million of net outflows last week, bringing total year-to-date exits to $125 million.
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Solana CME Futures Fell Short of BTC and ETH Debuts, but There's a Catch
When adjusted for asset market capitalization SOL's relative futures volume looks better, K33 Research noted.
What to know:
- Solana's SOL futures began trading on the Chicago Mercantile Exchange (CME) on Monday, with a notional daily volume of $12.3 million and $7.8 million in open interest, significantly lower than the debuts of bitcoin (BTC) and ether (ETH) futures.
- Despite the seemingly lackluster debut, when adjusted to market value, SOL's first-day figures are more in line with BTC's and ETH's, according to K33 Research.
- Despite the bearish market conditions, the launch of CME SOL futures offers new ways for institutions to manage their exposure to the token, said Joshua Lim of FalconX.
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