Capital Flowing Back Into Crypto at $4.5B Per Month, Largely into Bitcoin and Ethereum

The recent surge in inflows follows an extended period of persistent outflows since the Terra blowout of last May.

The global cryptocurrency market has started witnessing massive inflows at $4.5 billion a month amid the renewal of investors’ confidence. This recent surge in inflows comes after persistent outflows from digital assets since April 2022, per data from Glassnode, a blockchain analytics platform.

Glassnode disclosed this bullish trend reversal in a recent analysis, citing data from the Realized Values of Bitcoin (BTC), Ethereum (ETH), and stablecoins. By combining the Realized Caps for Bitcoin and Ethereum with the supplies of stablecoins, the total estimated value of realized assets across major cryptocurrencies amounts to a whopping $682 billion.

The Realized Cap is one of the most important on-chain valuation tools for #Bitcoin and #Ethereum

If we take the Realized Cap for $BTC + $ETH and add it to stablecoin supplies, we can estimate there is $682B in realized asset value across the majors.https://t.co/BxQgY2ORqn pic.twitter.com/1VWfrr0FD3

— glassnode (@glassnode) February 22, 2023

Glassnode suggests that incorporating the Realized Value metric is critical in accurately gauging the market’s value. This approach excludes illiquid assets and speculative off-chain trade volume, thus prioritizing on-chain volume and yielding a more lucid and refined assessment of the market’s worth.

Based on this metric, Bitcoin, Ethereum, and stablecoins are the primary players in the cryptocurrency market, offering a comprehensive depiction of capital inflows and outflows. Notably, Bitcoin holds a dominant share of 56%, while Ethereum and stablecoins occupy 25% and 19% of the total market value, respectively.

In light of these findings, Glassnode’s analysis ascertained the current influx of capital into the cryptocurrency market, which stands at an impressive $4.5 billion per month, with most funds flowing into the market via BTC and ETH.

From this, we can estimate the net capital flows into the digital asset industry, considering most fiat comes in via $BTC, $ETH, or stables.

After a period of outflows since Apr-2022, capital is flowing back in at $4.5B/month, primarily into $BTC + $ETH.https://t.co/prfskVXCox pic.twitter.com/6yQpgVF5bx

— glassnode (@glassnode) February 22, 2023

According to the Glassnode chart, the market had witnessed massive outflows since the Terra collapse in May until recently. These outflows saw an enormous surge late last year after the FTX implosion. As the market stages a recovery and demand resurfaces, the trend changes.

Moreover, a Turkish-based crypto analytics account recently drew attention to a significant influx of capital towards stablecoins in recent days, concerning data from CryptoQuant. The high stablecoin inflows in Asian markets can help Bitcoin and altcoins to rally.

There has been a high amount of stablecoins inflows to the stock exchanges in recent days, and if Hong Kong-side purchases come, it will be positive for the rise. ?✍️

We’re going to keep winning. ✍️?$Floki #Btc #Binance #SHIB #Kriptopara #Altcoin #Crypto #ACH #Floki #LUNA pic.twitter.com/WuekVV0OmM

— Crypto Bitcoin CT (@CryptoBitcoinCT) February 23, 2023

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