Institutional investors have turned their focus from Ethereum to layer one blockchains. The capital inflows into other altcoins have significantly increased over the past week, while capital outflows from Ethereum have increased over the past three weeks.
Ethereum’s capital outflows hit $17 million
A Digital Asset Fund Flows report by CoinShares showed that $3.5 million worth of inflows went into Terra (LUNA), Solana (SOL), Avalanche (AVAX) and Algorand (ALGO). On the other hand, the total capital outflows from Ethereum (ETH) nearly reached $17 million in just one week.
This is the third consecutive week that Ethereum products have recorded significant outflows. Within the three weeks, capital outflows from Ether products have reached $59.3 million. On the other hand, Bitcoin products saw increased inflows of $2.6 million despite the increased volatility.
Over the past two and a half months, inflows to Ethereum products have also increased and have reached $68.5 million, signalling a bearish trend towards the altcoin by institutional investors.
“Ethereum killers” are becoming popular
Ethereum has yet to switch to a proof-of-stake network, and network users are still plagued by high gas fees and slow transaction speeds. This has increased the popularity of the so-called “Ethereum killers”, which are alternate layer one blockchains.
DappRadar shows that decentralized app (DApp) usage on the Solana network has increased significantly over the past week. Some of the top projects on the Solana network, such as Orca and Raydium, have recorded increased volumes of 43% and 15.5% over the past week. Solana inflows were reported to be $800,000.
On the other hand, Avalanche is attracting interest because of the incentive programs running on the network that could lure more developers. This is causing a long-term bullish outlook for AVAX. Inflows to AVAX have reached $1.8 million over the past week.
Inflows to other networks such as Terra and Algorand were $700,000 and $200,000, respectively. Despite Bitcoin’s inflows reaching$2.6 million, the monthly outflows for digital gold have reached $178 million.
The crypto market is reporting increased volatility that is spooking investors. $219 million has left the crypto market during the past three weeks. During the first week of April, $134 million left the market amid a strong bearish sentiment. Despite the poor performance of the crypto market since the year began, $389 million has gone towards the crypto assets, showing that the year-to-date flows have remained positive.
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