Institutional investors are currently bearish on Bitcoin (BTC) and Ethereum (ETH), leading to significant outflows from digital asset investment products globally. Altcoins such as Solana (SOL) and XRP are being seen as better alternatives in the current market scenario. CoinShares reported a $1.2 billion outflow from digital assets funds in the past two weeks, indicating a “true correction” in the market.
The outflow from digital asset investment products reflects pessimism among institutional investors regarding potential interest rate cuts by the US Federal Reserve this year. The report from CoinShares on June 24 revealed that digital asset investment products recorded a $584 million outflow in just one week. James Butterfill, head of research at CoinShares, highlighted that Bitcoin saw the most significant outflows, amounting to US$630 million.
Investors in the United States and Canada accounted for the majority of the selloff, with $475 million and $109 million outflows, respectively. Germany, Hong Kong, and Sweden also contributed to the bearish sentiment. However, Switzerland and Brazil stood out by attracting inflows of $39 million and $48.5 million, respectively, defying the overall trend of outflows in the market.
While Bitcoin and Ethereum faced selling pressure and recorded price dips, altcoins like Solana, XRP, Litecoin, and Polygon saw inflows from investors. Solana recorded $2.7 million in buying activity, with the current price at $125, representing a 6% drop amid the market sell-off. XRP saw $0.7 million in investments, with the price currently trading at $0.475, down 2% in the past 24 hours.
Despite the overall negative sentiment in the market, altcoins such as Solana and XRP have managed to attract investor interest, indicating that some market participants see value in these alternative cryptocurrencies. As Bitcoin and Ethereum face pressure from institutional selling, the inflows into altcoins like Solana and XRP suggest that investors are seeking opportunities beyond the major cryptocurrencies in the market.
In conclusion, the recent outflows from digital asset investment products globally reflect a cautious approach by institutional investors towards Bitcoin and Ethereum. Altcoins like Solana and XRP have emerged as more attractive options, with investors showing interest in these alternative cryptocurrencies. The market dynamics continue to evolve, with investors closely monitoring developments in the digital asset space to make informed investment decisions.
