Solana (SOL) Price Dips After Record Inflows, Breaking Momentum Since March 2022

Quick Overview

Solana led interest among altcoin funds last week, adding $24 million — registering its largest inflows since March 2022. Overall, digital-asset investment products recorded net inflows for the second successive week and the most since July, adding $78 million — dominated by bitcoin investment products.

Digital-Asset Investment Products Overview

Digital-asset investment products at asset managers such as CoinShares, Grayscale, 21Shares, Bitwise, and ProShares recorded inflows for the second consecutive week and the most since July, adding $78 million, led by Solana and Bitcoin funds.

• Solana investment products returned their largest inflows since March 2022, adding $24 million, according to CoinShares’ latest report.
• Solana is “continuing to assert itself as the altcoin of choice,” Head of Research James Butterfill wrote, particularly considering the recent launch of ether futures ETF products.
• Solana funds have recorded inflows in 28 weeks this year, with just four weeks of outflows in 2023.
• Bitcoin dominated the overall inflows, adding $43 million. However, some investors capitalizing on recent price strength began adding to short-bitcoin product positions — resulting in inflows of $1.2 million during the same period.

Regional Analysis

The regional divide continued, with Europe outpacing the United States again last week — accounting for 90% of the inflows. The U.S. and Canada made up just $9 million of the inflows combined, suggesting further divergence in sentiment, according to Butterfill.

Trading Volumes and Ether Futures ETFs

Trading volumes for exchange-traded products also witnessed a 37% spike, reaching $1.13 billion for the week — and bitcoin volume on trusted exchanges saw a 16% rise.

Last week’s launch of six ether futures ETFs in the U.S. attracted just under $10 million, highlighting a “tepid appetite,” Butterfill said. Especially when compared to the $1 billion witnessed by bitcoin futures ETFs in their first week in 2021, albeit in a very different market environment.

“It is likely due to poor investor appetite for digital assets at present, and unfair to compare to the bitcoin futures ETF launches in October 2021, as appetite was much higher for the asset class overall,” Butterfill said.