Blue-Chip Cryptos Dominate Inflows While Altcoins Await Their Turn

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According to the latest Digital Asset Fund Flows report, cryptocurrency investment products recorded a second consecutive week of inflows totaling $78 million. However, stark regional divides persist, with Europe accounting for 90% of the fresh capital.

Bitcoin was the primary beneficiary of last week’s inflows, attracting $43 million. This affirms BTC remains the go-to crypto asset among institutional investors, even as some took short positions amid its latest price surge.

US investor demand remains tepid 

Ethereum, meanwhile, saw lackluster interest following the long-awaited launch of futures-based ETFs in the US. The new products drew less than $10 million in the first week combined.

Analysts attribute the muted reaction to a generally weak investor appetite rather than flaws with the ETFs. Comparisons to Bitcoin futures ETFs debuting in a bull market likely set unrealistic expectations.

Beyond Bitcoin and Ethereum, Solana grabbed attention as the top altcoin choice last week, with its most significant inflows totaling $24 million since March. Solana continues to assert itself as a favorite asset for funds, looking beyond the big two.

Overall, the report highlights the dichotomy between surging European investment and the more cautious stance of US investors during the ongoing bear market.

Flows remain well below last year’s levels but appear to be stabilizing. This consolidation could signify markets laying the foundation for the next bull run, pending a shift in macroeconomic conditions.

Inflows remain concentrated in blue-chip crypto assets, while speculative fervor around smaller altcoins remains muted. But a sustained appetite for digital asset exposure, even at depressed prices, is an encouraging signal heading into 2023.