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Solana (SOL) is favoured among institutional investors

Solana (SOL) is favoured among institutional investors

Institutional traders have flocked to Solana (SOL) as demand for Ethereum (ETH) and Bitcoin (BTC) has leveled off. SOL investment products accounted for a whopping 86.6% of total weekly cash inflow into crypto investment products last week. Data from Coinshares shows that Solana (SOL) investment products saw a cash inflow of $49.4 million between September 6 and 10. Combined total inflows for crypto investment products equaled $57 million for the week, with SOL taking up 86.6% of total inflows. Institutional money inflow to SOL increased by about 250% in one week.

The rising cash inflow into Solana products was accompanied by a 36% price increase in SOL over the same period. Coinshares concluded the following in their weekly report:

“A combination of price appreciation and cash inflows now brings Solana's assets under management to $97 million, the 5th largest of all crypto investment products.”

Cryptocurrencies have now seen net inflows for the fourth week in a row, with the demand for altcoins significantly outpacing the demand for BTC products, which saw a tiny inflow of $200,000. The influx was also partially offset by institutional investors who had to sell $6.3 million worth of Ethereum as the price of the underlying fell more than 10% over the course of the week.

Despite the anticipation of Cardano (ADA)'s smart contracts on Monday, September 13, institutional flows to ADA tracking products saw a 46% drop in inflows compared to the week before. Also, ADA fell about $0.40 from $2.70 to $2.30 on the day of the launch. Other altcoin-tracking products such as Ripple (XRP), Polkadot (DOT) and Bitcoin Cash (BCH) also saw inflows of $3.1 million, $1.7 million and $600,000, respectively.

According to CoinShares estimates, institutional asset managers currently own $56.3 billion in total crypto - down 9% from the previous week, not because of the withdrawal of money, but because the crypto market saw a sharp correction over the past week. Logically, the value of all assets also fell sharply as a result. Flows were unevenly distributed among asset managers, with CoinShares XBT and Purpose funds taking out $24.7 million and $45.5 million respectively, while 21Shares, ETC Group and CoinShares saw inflows of $75 million, $13 million and $6.1 million, respectively.

Grayscale, one of the most reputable crypto asset managers, continued to dominate, representing 74% of the industries' AUM (Assets Under Management) at $41.8 billion. Grayscale's three largest holdings are Bitcoin (BTC), Ethereum (ETH) and Cardano (ADA), respectively, but the investment giant now also owns Solana (SOL).