Crypto investors are shifting their focus away from Bitcoin and towards other cryptocurrencies such as Ether and XRP. This comes as Bitcoin-related investment products experienced their first week of outflows since Blackrock filed for spot Bitcoin ETF in June. According to CoinShares’ head of research, James Butterfill, Bitcoin investment products saw outflows of $13 million for the week ending July 21, reversing a five-week trend of inflows. Short Bitcoin products also saw outflows of $5.5 million during the same week.
In contrast, both Ethereum and XRP investment products recorded a combined inflow of $9.2 million over the past week. Ethereum emerged as the best-performing cryptocurrency with inflows of $6.6 million, while XRP funds recorded an inflow of $2.6 million. Other altcoins, including Solana and Polygon, tracked inflows of $1.1 million and $0.7 million, respectively.
This shift in sentiment can be attributed, in part, to Ripple’s recent victory against the United States Securities and Exchange Commission (SEC). On July 13, the court ruled that XRP is not a security when sold on exchanges to the general public. This ruling caused a surge in XRP’s price, reaching a high of $0.83 before stabilizing at $0.69.
Despite the changing landscape, Bitcoin still remains the dominant digital asset investment product, with $558 million in inflows so far in 2023 and a total of $25.0 billion in assets under management. This accounts for 67.4% of the total market share. However, the recent shift in investor preference indicates a growing interest in alternative cryptocurrencies.
Over the past month, several financial institutions, including BlackRock, ARK Invest, Fidelity, and VanEck, have filed for Bitcoin spot Exchange Traded Fund applications with the SEC. These moves reflect a growing acceptance and recognition of cryptocurrencies as viable investment options.
Bitcoin investment products have experienced a week of outflows, while Ether and XRP investment products have gained momentum. This shift in sentiment can be attributed to various factors, including Ripple’s legal victory and the growing interest in alternative cryptocurrencies. While Bitcoin remains the dominant cryptocurrency, the changing landscape suggests that investors are diversifying their portfolios to include other promising digital assets.