3 September 2024
Solana price action might be trending downwards, but institutional investors are bucking the trend. This speck of positive Solana sentiment has come through an inflow report of digital asset investment report, with Solana coming up on top.
Digital asset investment products witnessed a cumulative outflow last week, especially as Bitcoin-based products failed to attract investor inflow. Particularly, data from CoinShares’s weekly report on digital asset fund flows noted a total outflow of $305 million last week, a vast difference from the $533 million registered in the previous week. Although the majority of outflow came through Bitcoin-based products, Solana managed to perform a 7,500% increase in inflows.
SOL Sees 7,600% Surge In Inflows
The digital asset investment landscape was marked by significant volatility in August. Last week’s cumulative outflows from the institutional niche highlighted the challenges faced by many cryptocurrencies. According to the most recent CoinShares report, Bitcoin can be credited with the lion’s share of the outflows, with the crypto’s products registering $319 million worth of outflows last week.
Altcoins, on the other hand, displayed varying results last week. Ethereum, the leading altcoin, mirrored Bitcoin’s performance with an outflow of $5.7 million amidst a low trading volume week for Spot ETH ETFs. However, every other altcoin managed to attract institutional inflow last week in what could be a reflection of growing confidence.
Notably, Solana-based products topped the charts with $7.6 million worth of inflows, which is a vast increase from the $0.1 million it registered in the prior week. As such, the crypto managed to perform a 7,500% inflow increase. This positive momentum for SOL is particularly notable because it marks a reversal from the negative sentiment that started to rise in mid-August. Just two weeks ago, Solana experienced the most significant outflow on record to the tune of $39 million, making the recent inflows even more important.
Solana ETF Changing The Narrative
A large part of the shift in Solana sentiment can be attributed to some rumors surrounding the launch of Spot Solana ETFs in the US. After the successful launch of Spot Bitcoin and Ethereum ETFs, the crypto industry has naturally shifted focus to the potential of a Spot ETF for the next big altcoin, and Solana has come into the limelight. Interestingly, Spot Solana ETFs recently went live in Brazil and the South American market. The most recent approval was given to Hashdex, a Brazil-based asset manager with over $962 million in assets under management.
While applications for Spot Solana ETFs have yet to gain traction in the US, many market participants remain optimistic. One such voice of optimism is DeFi commentator @CryptoNobler.
NASDAQ just secured approval for the $SOL ETF!
SEC no longer classifies $SOL as security, and BlackRock is already applying.
Solana bull run is about to ignite and many alts will skyrocket 1000x pic.twitter.com/XTWoFXecD3
— 0xNobler (@CryptoNobler) August 28, 2024
At the time of writing, Solana is trading at $134. Interestingly, the crypto trended downwards for the majority of the last seven days until it bounced up off a support level at $127 on September 2. Solana has now been up by 4.52% in the past 24 hours.