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Crypto Market Sees $18.77 Billion Inflow, Driving Price Recovery

Coin WorldMonday, May 5, 2025 8:38 pm ET

1min read

On-chain data reveals that the cryptocurrency market has experienced a significant influx of capital, totaling nearly $19 billion, as Bitcoin and other digital assets have shown signs of recovery. This trend highlights a positive shift in investor sentiment and capital allocation within the digital asset sector.

Analysts have noted that capital flows in the cryptocurrency market primarily occur through three main asset classes: Bitcoin, Ethereum, and stablecoins. Altcoins typically see secondary capital rotations from these primary assets. Therefore, monitoring the netflows of Bitcoin, Ethereum, and stablecoins provides a comprehensive view of the overall market dynamics.

To measure capital inflows and outflows for Bitcoin and Ethereum, the "Realized Cap" indicator is utilized. This on-chain capitalization model assesses the total value of an asset's supply by considering the value of each token at its last transaction price, unlike the traditional Market Cap, which sums up the supply at the current spot price. The Realized Cap reflects the total capital invested by cryptocurrency holders, with changes in this metric indicating capital inflows or outflows.

For stablecoins, the change in Market Cap is sufficient to gauge capital netflow, as their Realized Cap is equivalent to their Market Cap due to their stable peg to fiat currencies. This simplifies the analysis of capital movements within the stablecoin sector.

Over the past month, the combined 30-day Realized Cap change for Bitcoin and Ethereum stands at a positive $12.58 billion, indicating a substantial net capital inflow. Similarly, stablecoins have seen a net inflow of $6.19 billion during the same period. This results in a total capital inflow of $18.77 billion for the digital asset sector as a whole.

This influx of capital has coincided with price recovery runs for Bitcoin and other assets, suggesting that sustained inflows could support further rallies. However, the cryptocurrency market is known for its volatility, and investor sentiment can shift rapidly. It remains to be seen how investors will behave in the coming days and whether this positive trend will continue.

Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.