Bitcoin‘s price experienced a rapid decline as over-optimism led to a reversal in risk appetite. However, it has since recovered, climbing from $40,750 to $42,800 after futures positions were balanced. This movement was partly triggered by speculation from Maxrixport, which suggested that the initial drop was merely a catalyst to correct inflated demand.
Institutional investors, facing the absence of a US-based spot Bitcoin ETF, have turned to trusts and ETPs like GBTC to invest in cryptocurrencies. Recent weeks have seen notable inflows, particularly after the Christmas holiday, as reported by CoinShares for the last week of 2023.
Bitcoin funds attracted a remarkable $243 million in inflows, contributing to an annual net inflow of $2.2 billion. This reflects the growing optimism for an ETF approval and a strong appetite for risk among institutional investors.
Throughout the year, Solana (SOL) witnessed the highest net inflows among altcoins. Its price surged from single digits to over $110, making it an astute investment choice. The substantial positive premium in the GSOL trust further supported SOL’s performance.
Ethereum (ETH) followed as the second most popular investment, with XRP Coin also attracting significant attention from institutional investors.
The data underscores a growing institutional interest in a diverse range of cryptocurrencies, beyond just Bitcoin, as the market continues to mature and attract more mainstream investment.