In October 2023, the crypto market has been seeing a significant revival expressed both in the growth of retail trade and activity among institutional capital. Crypto funds are recording a 44.3% increase in daily trade volume compared to September.
At the same time, the total amount of assets under management (AUM) increased by 6.7% to $31.7 billion.
As expected, most of the funds were accumulated by Bitcoin, which holds a 73.3% share of large players' interest, worth $23.2 billion.
However, there's been a change in sentiment regarding altcoins. Ethereum remains the second-largest coin in terms of investment attracted, coming in at $6.4 billion. However, compared to September, it's seen an outflow of funds and a decrease in its share from 22.6% to 20.1%. In contrast, Solana is seeing a 74.1% growth in incoming funds to $140 million.
Interest in Ethereum is falling both for internal reasons (increased centralisation, reduced staking profitability) and because of moves by the SEC (preventing the promotion of staking in the United States, labelling the altcoin a security).
In recent SEC claims, Solana has also been designated as a security, but this hasn't prevented the project from attracting large companies to work with it. In particular, the e-commerce giant Shopify has added the Solana Pay service to its list of payment methods (currently, settlements are available only in USDC). Visa also uses the blockchain network to conduct faster and cheaper settlements in the interbank market.
In addition to Solana's good prospects for expanding its business, it is also attracting investors due to its low entry barrier. In 2022, the cryptocurrency's price plummeted by 94% to $10 per coin.
This strong decline was caused by a number of joint projects implicated in FTX's collapse. The failed crypto exchange's accounts still contain nearly $2 billion worth of SOL. A court decision recently authorised Galaxy Digital to oversee the liquidation of FTX's assets. According to Galaxy Digital, it will set a monthly limit of $100 million in order to minimise the negative impact on Solana's price.
StormGain Analytical Group
(platform for trading, exchanging and storing cryptocurrency)
