BTC/ETH ETF "Bleeding" VS XRP "Sucking" Nearly 900 Million: Market Rotation or Change in Sentiment? | MyToken AMA Recap

Recently, the cryptocurrency ETF market has shown significant divergence: Bitcoin and Ethereum-related products experienced substantial net outflows, while various altcoin ETFs, especially XRP ETFs, continued to attract institutional funds, indicating a notable adjustment in the capital structure. Mainstream asset capital flows clearly out:

Bitcoin spot ETFs saw a single-day net outflow of approximately $195 million on December 5th, marking one of the weakest performances in weeks. Ethereum ETFs also recorded significant net outflows at that time, contrasting sharply with the pressure on BTC and ETH. Meanwhile, XRP ETFs maintained continuous net inflows for several weeks, with total inflows approaching $900 million, demonstrating that institutional confidence in its relative value and potential regulatory benefits continues to strengthen.

Is this phenomenon a short-term safe-haven behavior, or a fundamental shift in institutional allocation logic? How should ordinary investors respond?

MyToken recently hosted a dedicated AMA, inviting multiple industry experts for in-depth analysis. Below is a review of the core viewpoints discussed.

Guest Introductions

Niu Mowang (@Btcniumowang): A senior analyst and KOL in the crypto field, focusing on primary and secondary market research, with unique insights into market structure and capital flows.

Christina (@ChristineKTX): CMO of KTX Exchange, which recently launched on-chain trading tools aimed at empowering retail traders with data.

Evan (@ChainThink_zh): Researcher at ChainThink blockchain media, specializing in market data analysis and industry trend interpretation, skilled at analyzing capital movements from macro and on-chain perspectives.

Summary of Views

1. Capital flow divergence: Short-term rotation or long-term shift?

All three guests agree that recent shifts of funds from mainstream coin ETFs to altcoin ETFs like XRP are more a result of short-term market rotation and macro safe-haven strategies rather than a fundamental change in institutional crypto asset allocation logic.

Niu Mowang pointed out that at year-end, institutions tend to lock in profits and balance positions. Due to their high liquidity and strong macro correlation, Bitcoin and Ethereum naturally become rebalancing targets. Meanwhile, the market is searching for the next potential ETF hot spot; assets like XRP are attracting capital due to regulatory progress and independent narratives.

Christina, representing an exchange emphasizing user experience and transparency, added that under macro uncertainty, institutions prefer assets with stronger narratives and regulatory backing. XRP’s developments in payments and DeFi sectors make it a recent focus of capital attention.

Evan analyzed from a market cycle perspective: Bitcoin’s recent rally is relatively mature, with decreasing volatility year over year; some profit-taking funds are shifting into lower-valued altcoins with solid fundamentals in search of higher alpha returns. However, this remains a “tactical rotation,” and Bitcoin and Ethereum’s benchmark status remains unchanged.

2. Will this become the norm? What is its impact on market structure?

Most guests believe that “exit from the mainstream, yet not exit from the market” capital rotation may become more normalized in the future, further layering the valuation system.

Niu Mowang likened Bitcoin to the “S&P 500,” more influenced by macro factors, while XRP, Solana, and others are like “growth stocks,” relying more on project fundamentals and narratives. The market will become more structured, with more precise sector rotation and shorter cycles.

Christina said that as the market matures and institutions deepen their involvement, capital will continuously seek the next growth points. She is optimistic about directions such as payments, on-chain credit scoring, and RWA (Real World Assets) with genuine business models.

Evan pointed out that the total market cap of cryptocurrencies has become so large that it’s difficult to sustain a broad rally. Future institutional allocations will likely focus on a combination of “mainstream coins + high-quality altcoins” to balance risk and reward.

3. How should retail investors respond?

Faced with institutional-led capital rotation, how should retail investors rationally view and utilize this trend? Should they follow the flow and frequently switch positions, or stick to core holdings and ignore short-term noise? What aspects should they pay attention to? The guests shared their perspectives.

Niu Mowang suggested that retail investors remain rational and avoid blindly following the crowd. Keep 70%-80% of core holdings in mainstream assets like Bitcoin and Ethereum, with a small proportion allocated to promising narrative tracks. Avoid emotional chasing of gains and panic selling.

Christina emphasized that retail investors are at a disadvantage regarding information and data. They can leverage tools (such as the upcoming on-chain signal products from KTX) to track capital flows. Portfolio should be centered on mainstream assets, with a small portion of funds carefully researched and invested in promising sectors.

Evan used vivid examples of friends following Yongping Pan to illustrate that retail investors differ greatly from institutions in capital scale and risk tolerance. Institutional ETFs may sometimes be just rebalancing moves. Position management is crucial, avoiding high-frequency switching, being cautious of high-yield traps, and focusing on long-term project value and fundamentals.

4. Which sectors continue to attract institutional attention?

Guests favor sectors with genuine demand, clear business models, and compliant outlooks:

Niu Mowang: optimistic about Solana (active ecosystem, payment potential), RWA (assets on-chain, stable yields), and AI (computing power demand combined with payment scenarios).

Evan: payment scenarios (such as U-card applications), RWA (improving efficiency of illiquid assets) are important directions.

Christina: besides payments, also focusing on on-chain credit scoring and mature DeFi protocols.

5. Why is XRP ETF capital inflow significant but the price reacts little?

Additionally, during community interaction, users asked why the inflow of XRP ETF data persists but XRP’s price remains relatively flat. Evan and Niu Mowang explained that this primarily stems from:

• Reduced market sensitivity to ETF narratives, with diminishing effects after multiple ETFs;

• Some inflows may be for institutional position swaps (converting spot holdings into compliant ETF products);

• The existence of unlocking selling pressure and historical trapped positions, which suppress rapid price increases.

Conclusion

This AMA revealed the complexity of current crypto market capital flows: institutional operations are becoming more sophisticated, with a game between institutions and retail investors. The market is shifting from a “bull market of broad gains” to a “structural bull market.” For investors, understanding rotation logic, maintaining core holdings, and participating rationally in trends may be key to navigating future markets.

As a neutral and comprehensive data platform, MyToken continuously provides deep data such as ETF capital flows and on-chain signals to support investment decisions, market insights, and tools. This article is based on MyToken AMA content; guest opinions are for reference only and do not constitute investment advice.