HomeNewsBitcoin Bulls Run: $2.25 Billion Flow into Digital Assets, Solana Overtakes Ethereum

Bitcoin Bulls Run: $2.25 Billion Flow into Digital Assets, Solana Overtakes Ethereum

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  • Digital asset investments saw a substantial increase in 2023, with inflows reaching $2.25 billion, 2.7 times higher than in 2022.
  • Bitcoin emerged as the primary beneficiary of this surge, accounting for 87% of the total inflows.

A Remarkable Year for Digital Assets

The year 2023 has been marked as the third-largest in terms of investment inflows into digital assets since 2017, with a remarkable total of $2.25 billion. This figure represents a significant increase, being 2.7 times greater than the inflows witnessed in 2022, and indicates a substantial turnaround for the asset class. The recovery was particularly notable in the final quarter, aligning with growing optimism around the potential approval of Bitcoin spot-based Exchange-Traded Funds (ETFs) by the SEC in the United States.

Bitcoin’s Unprecedented Dominance

In the realm of digital assets, Bitcoin stood out as the predominant beneficiary, attracting $1.9 billion in inflows, which accounts for an impressive 87% of the total flows. This level of dominance is unprecedented in the history of cryptocurrency flows, surpassing the previous peak in 2020 when Bitcoin received 80% of total inflows. The surge in Bitcoin investments can be attributed to heightened investor enthusiasm and expectations surrounding SEC’s ETF approval.

Ethereum and Other Cryptocurrencies

While Ethereum saw a recovery in inflows, ending the year at $78 million, it lagged behind in comparison to the total Assets under Management (AuM), representing only 0.7%. On the other hand, Solana experienced a surge in investor interest, with inflows totaling $167 million, accounting for 20% of its AuM. This shift indicates a diversifying trend among investors, exploring alternatives to Ethereum.

Geographical Distribution of Inflows

Geographically, the United States recorded the highest inflows in absolute terms with $792 million, but this constituted only 2% of its AuM. In contrast, Germany witnessed the highest inflows relative to AuM at 22%, followed by Canada and Switzerland at 15% and 13%, respectively. The relatively lower proportion of inflows in the U.S. could be due to investors’ preference for a spot-based ETF.

Blockchain Equities Also on the Rise

Alongside cryptocurrencies, blockchain equities also benefited from the positive market sentiment. The AuM for blockchain equities rose by 109%, with total inflows reaching $458 million, which is 3.6 times the inflows seen in 2022. This trend highlights the expanding interest and confidence in blockchain technology and its associated assets.

2023 stands as a testament to the resilience and growing maturity of the digital asset market, with Bitcoin leading the way and blockchain equities gaining significant traction among investors.

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Nikita Dmitrievich
Nikita Dmitrievichhttps://www.ethnews.com/
Nikita, a young and ambitious crypto investor who has been actively involved in the cryptocurrency world for the past 6 years. With a keen interest in blockchain technology, Nikita has been investing in various cryptocurrencies and has seen significant returns on his investments. He is passionate about educating others on the potential of cryptocurrencies and frequently shares his insights on social media platforms. Nikita believes that cryptocurrencies are the future of finance and is constantly researching new projects to invest in. With his dedication and knowledge, Nikita is quickly becoming a prominent figure in the crypto community. Business Email: info@ethnews.com Phone: +49 160 92211628