Impressive Inflows for Solana in 2023

Solana dominates with 27 weeks of inflows, while Bitcoin rebounds and Ethereum faces consistent outflows in 2023.

Solana continues its impressive dominance in the crypto market, boasting a remarkable 27 weeks of investment inflows, setting itself apart in the altcoin domain. This performance makes it the institutional investors’ favorite choice, as revealed in CoinShares’ recent cryptocurrency fund report. While many altcoins stagnate in terms of activity, Solana thrives.

2023 paints a brilliant picture for Solana. Over the course of this year, the cryptocurrency has witnessed a staggering 27 weeks of inflows, overshadowing a mere four weeks of selloffs. Last week, institutions invested another $5 million in the asset. James Butterfill, the head of research at CoinShares, attributes this sustained interest to Solana’s ability to maintain its position as the top altcoin for this year.

Despite once being pegged as the “Ethereum killer“, Solana’s success isn’t about overshadowing its competitors but rather forging strong partnerships. Leading financial institutions, including payment behemoth Visa, have partnered with Solana. These partnerships emphasize ultra-fast and cost-effective transactions. Even though Solana might not have a user base or developer community as extensive as Ethereum’s, its investor appeal remains unmatched.

Market Highlights: Solana, Bitcoin, and Regional Updates

Today marks a new achievement for Solana. The network reported its highest total value locked (TVL) for the year at $338.82 million, as per DefiLlama’s data. Additionally, SOL, Solana’s native token, recorded a significant price surge. It’s now trading at $23.40, reflecting a 20% increase over the past week.

Bitcoin, another heavyweight in the crypto arena, also shows signs of revival. Shaking off its recent bearish tendencies, Bitcoin reported a solid $20.4 million in inflows in recent days. James Butterfill theorizes that the current turmoil over government funding in Washington D.C. might be a contributing factor to Bitcoin’s resurgence. Another influencing element might be the correlation between the inflow timings and the rise of the 10-year government bond.

However, all isn’t rosy in the crypto world. Trading volumes have seen a significant dip, averaging at $3 billion daily, a considerable decline from the previous year’s $11 billion. Butterfill compares these levels to those seen in 2020.

Diving deeper into regional specifics, there’s a noticeable discrepancy among large investors. The U.S. reported cryptocurrency outflows totaling $19 million. In contrast, Canada demonstrated a bullish sentiment, with buying pressures leading to inflows of $17 million. Europe also displayed a positive trend, with cryptocurrency inflows reaching $23 million.

While Solana and Bitcoin are making headlines, Ethereum seems to be struggling to find its footing. For 2023, Ethereum has earned the not-so-flattering title of the “least-loved altcoin”. The evidence? A consistent outflow of investments, amounting to $1.5 million recently, culminating in a whopping $114 million offloaded throughout the year.