Solana has consistently been the leading choice in the altcoin category for the past nine weeks, benefiting from significant fund inflows and positive sentiment.
Solana ($SOL) has consistently held the top position in the altcoin category for the last nine weeks, experiencing a steady influx of funds. This achievement stands in contrast to the ongoing outflows observed in other major cryptocurrencies within the market.
According to CoinShares’ weekly report on digital asset fund flows, Solana recorded approximately $0.7 million in total fund inflows in the previous week alone. Over the course of the past nine weeks, it has accumulated an impressive $14.1 million in inflows.
While the crypto market experienced a downturn, Solana remained resilient. During this period, other altcoins like Ethereum ($ETH) and Polygon ($MATIC) faced challenges, with outflows of $3.2 million and $8.6 million, respectively. Conversely, Bitcoin ($BTC), the largest digital asset by market capitalization, saw inflows of $3.8 million. Notably, institutional investors continued to withdraw from short Bitcoin products for the 19th consecutive week, leading to a 48% drop in its total assets under management (AuM) from this year’s peak.
Taking a broader view, digital asset fund flows were also in the negative, reporting an outflow of approximately $11.2 million. Over the past seven weeks, total outflows amounted to approximately $342 million. Blockchain equities also saw outflows for the fourth consecutive week, totaling $25 million. The report further highlighted that digital asset investment product flows had cooled off, resulting in relatively minor outflows.
On a positive note, trading volumes were significantly higher than the average, despite limited activity in terms of flows. The total trading volume for the week reached $2.8 billion, which is 90% higher than the year-to-date (YTD) average.
CoinShares attributed this increase in trading volumes to the ongoing discussions and concerns surrounding the regulation of digital assets. The beginning of the previous week brought hopes for the approval of a spot exchange-traded fund (ETF) in the United States, but these hopes were subsequently followed by further delays for all other spot ETF applications.
Is Solana Emerging as the Most Beloved Altcoin?
Solana’s resilience in the face of the recent crypto outflows, coupled with year-to-date (YTD) inflows totaling $26 million, has firmly positioned the coin as one of the most cherished altcoins among investors. This distinction comes on the heels of numerous favorable developments within the Solana network, marked by its enhanced performance and reliability.
Solana has garnered support from a roster of prominent companies that contribute to the Solana ecosystem, including industry giants like Google, Stripe, and Discord. With a total market capitalization of approximately $7.9 billion and a 24-hour trading volume of around $253 million, Solana has firmly established itself.
Remarkably, Solana’s mainnet experienced just one network outage this year. Additionally, Rune Christensen, co-founder of MakerDAO, proposed the use of the Solana codebase as the foundation for his project’s new native blockchain.
Moreover, Solana made headlines when Shopify integrated Solana Pay into its payment options, capitalizing on the stability of USDC. The Solana ecosystem boasts an impressive user base of over 11.5 million active accounts, and the introduction of its protocol, Solana Pay, marked a significant advancement in decentralized payment systems.
Recently, the encryption protocol Elusiv introduced a new feature enabling private token swaps on the Solana blockchain. This development allows users to swap various assets without disclosing any identifying information, pioneering private exchanges of decentralized assets on the blockchain.
Nevertheless, the Solana ecosystem continues to grapple with the aftermath of the FTX and Alameda Research collapse that occurred last year. FTX held over $1 billion in Solana and related coins, potentially exerting additional liquidation pressure, particularly in light of the current administration’s efforts to reimburse creditors.
Several analysts also observed wallets associated with FTX transferring SPL tokens via the Wormhole bridge to the Ethereum network over the weekend, reigniting concerns about potential liquidation.
At the time of writing, $SOL is trading in the red, with its price having declined by over 3% in the past week. The altcoin is currently priced at $19.48, reflecting a decrease of over 1% in the last 24 hours.
This news is only analytical and informative and is not a recommendation for investment in any way.
