Authors: Golem, Odaily Odaily
Original title: "SOL Guardians, Don't Panic, Major Funds Are Here to Support You"
Bitcoin fell below $100,000 again today, plunging the crypto market into a state of extreme fear, with the Fear & Greed Index reaching 22.
The withdrawal of institutional buying is one of the main reasons for the recent market downturn. According to SoSoValue data, on November 13th, Bitcoin spot ETFs saw a total net outflow of $870 million, the second highest in history. In the past month (October 13th to November 13th), Bitcoin spot ETFs only saw net inflows on 7 days, with a net outflow of $1.84 billion for the month. The situation for Ethereum spot ETFs is also not optimistic. According to SoSoValue data, they also saw net inflows on only 6 days in the past month, with a net outflow of $1.06 billion for the month.
ETFs, which have been the main external buying support for this bull market, have been continuously selling off Bitcoin and Ethereum. Does this mean that mainstream funds in traditional finance have also lost interest in crypto?
During the US government shutdown, on October 28th, the first US Solana spot ETF—the Bitwise Solana Staking ETF (ticker symbol BSOL)—officially listed on the NYSE, attracting a net inflow of $69.45 million on its first day of trading, according to SoSoValue data. Following closely, on October 29th, the Grayscale Solana Trust ETF (ticker symbol GSOL) was also converted from a trust to an ETF and officially listed on the NYSE.
Currently, there are only two Solana spot ETFs on the market. As of November 13, the total net asset value of the Solana spot ETFs was $533 million, with a Solana net asset ratio of 0.64%, and a historical cumulative net inflow of $370 million.
Although the total net inflow of funds into the Solana spot ETF is still less than one percent of that into the Bitcoin spot ETF, the fact that the Solana spot ETF has maintained net inflows for 13 consecutive days is quite reassuring given the current situation of funds withdrawing from other ETFs and the continued decline in the price of SOL.
For SOL investors, this is also a positive sign that can be inferred. ETF funds are accumulating shares at the bottom of SOL and providing buying support. After sufficient turnover, SOL may begin an independent trend.
Why are traditional financial funds buying into SOL?
The most likely reason for the large-scale purchase of Solana spot ETFs by traditional financial institutions is the attractive staking yields. Unlike holding Bitcoin spot ETFs, investors can earn additional returns by purchasing Solana spot ETFs. Bitwise and Grayscale have both committed to supporting SOL staking and distributing staking rewards to users.
Compared to Ethereum's APY of around 2%, Solana's average APY of around 7% is more attractive. Matt Hougan, Chief Investment Officer at Bitwise, also stated, "Institutional investors like ETFs because they like returns, and Solana has the highest returns of all blockchains. Therefore, institutional investors like Solana ETFs," and he believes that as institutional buying continues to grow, the next phase of Solana will be driven by more rational capital.
Meanwhile, institutional investors may simply be large-scale investors in the market, eagerly chasing after high APY crypto products. The launch of the Solana spot ETF has given institutional investors access to higher APY crypto products, and from a profit-seeking perspective, it may also drain funds from Ethereum spot ETFs in the future.
When will the price of SOL rise?
From the perspective of government shutdowns and weakened regulation, the launch of the Solana spot ETF came at a good time; however, from the perspective of the market environment, the launch of the Solana spot ETF was truly ill-timed. Not only was the crypto market sentiment depressed, but it also coincided with a sell-off by whale. For example, Jump Crypto sold over 1.1 million SOL tokens on October 30th, worth over $200 million. Since the launch of the Solana spot ETF on October 28th, the price of SOL has fallen by over 26%.
The $370 million net inflow into the Solana spot ETF since its launch is far from enough to absorb the selling pressure resulting from a confluence of market factors. Macroeconomic changes and market sentiment are always unpredictable, but at least one thing is certain: institutions are continuously increasing their holdings of SOL through the Solana spot ETF. With other crypto assets being dumped and suffering continuous losses, SOL has gained a more solid backing, with ample institutional buying support now in place.
Generally, institutional investors or ETF buyers hold positions for a longer period than ordinary investors. Currently, with major SOL whale cashing out and prices remaining low, the continued inflows into the Solana spot ETF are equivalent to institutions building positions at the bottom, making them even less likely to sell easily in the future.
In the second half of this year, major cryptocurrencies such as BTC, ETH, and BNB all broke through their previous highs, but SOL, after reaching a price high of $295 in January, has failed to break through again. One of the main reasons is the excessive profit-taking. From October 2024 to January 2025, SOL rose from $152 to $295 in three months, an increase of nearly 100%. Now, as the previous profit-taking in SOL is gradually "cleared out," new and more determined structural buying will enter the market, opening up a future upward channel for SOL.
For ordinary investors, a market downturn can bring pain, but it can also present a "golden opportunity."
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