Minor crypto inflows in latest week; Solana outflows hit record high
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Dollar falls; bitcoin off ~2%; crude down >2.5%; gold slips
U.S. 10-Year Treasury yield dips to ~3.86%
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MINOR CRYPTO INFLOWS IN LATEST WEEK; SOLANA OUTFLOWS HIT RECORD HIGH
The crypto market saw minor net new inflows of $30 million from institutional investors in the latest week that ended on Aug. 17, according to weekly data from digital asset manager CoinShares.
That was sharply down from the $176 million in inflows posted in the previous week, as investors saw price declines in crypto as a buying opportunity.
CoinShares attributed last week's low institutional inflows to the fact that recent economic data has reduced the chances that the Federal Reserve will cut interest rates by 50 basis points in September. The fed funds futures market is currently pricing in a 75% chance that the Fed will cut by 25 bps next month.
Weekly trading volumes on investment products fell as well to nearly 50% of the previous week to $7.6 billion, the CoinShares report showed.
Flows were mixed overall from a regional perspective, CoinShares said, with the U.S., Canada, and Brazil showing inflows of $62 million, $9.2 million, and $7.2 million, respectively. Switzerland and Hong Kong, however, had the largest outflows of $30 million and $14 million.
Bitcoin saw the biggest inflows of $42 million, while short-bitcoin exchange traded funds (ETFs) had outflows for a second consecutive week of $1 million.
Ethereum, on the other hand, attracted just $4.2 million inflows last week, sharply down from $155 million inflows in the week before last. So far this year, Ethereum has taken in roughly $866 million in inflows, the highest since 2021, primarily driven by the recent launch of U.S. spot ETFs based on the blockchain.
In contrast, Solana, a blockchain similar to Ethereum, posted the largest outflows on record of $39 million, amid a sharp decline in trading volumes of meme coins, on which it is heavily reliant, according to the report.
Solana, known for its high throughput or turnover and low transaction fees, had seen a surge in growth in the meme coin sector since 2023. It has become an attractive venue for the development and trading of meme coins.
Meme coins, however, have tumbled with the broader correction in crypto prices. The Solana meme market cap today is down 5.6% in the last 24 hours at around $5.6 billion. Meme coins native to the Solana network have plummeted, with some of them being liquidated massively, according to market participants.
(Gertrude Chavez-Dreyfuss)
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