Despite the market’s “broad negative sentiment,” which has seen crypto investment products experience outflows, institutional investors have allocated more than $1 million to cryptocurrency investment products that provide exposure to Solana ($SOL).
According to CoinShares’ most recent Digital Asset Fund Flows report, investment products focusing on Solana saw $700,000 inflows last week, adding to the $400,000 seen the previous week for a total of $1.1 million in December.
According to the firm’s report, cryptocurrency investment products saw $30 million in outflows last week due to lingering uncertainties surrounding the collapse of businesses linked to FTX and the Federal Reserve’s continued hawkish rhetoric.
Over the last week, investment products focusing on Bitcoin ($BTC) saw outflows of $17.5 million, while products shorting the flagship cryptocurrency saw inflows of $1.1 million.
According to the report, Solana rival Ethereum ($ETH) experienced its fifth consecutive week of outflows totaling $9.1 million.
Total crypto investment product assets under management fell to $22.3 billion.
The collapse of FTX had a significant impact on the price of Solana. FTX CEO Sam Bankman-Fried, who was arrested earlier this week in the Bahamas, is a well-known supporter of $SOL and has invested in a number of projects within the cryptocurrency’s ecosystem. His involvement in these projects has impacted investors’ trust in them in the aftermath of FTX’s demise. $SOL is trading near the $12 mark at the time of writing, having hit a $11 low last month.
According to data from on-chain analytics firm Santiment, the fear surrounding Solana could lead to a price rebound. This could occur if short sellers begin to exit their positions, resulting in a short squeeze.
When the price of an asset rises rapidly and unexpectedly, this is referred to as a short squeeze. As short sellers close their positions, an influx of buy orders may cause the asset’s price to rise even further.
Disclaimer: The information provided is not trading advice, Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.