- Solana sees $485M in outflows as investors pivot to Ethereum, Arbitrum, and BNB Chain amid rising crypto market uncertainty.
- Stablecoins hit $224B while RWAs peak at $17.1B, signaling a major shift toward safer digital and real-world investments.
- Bitcoin dominance climbs to 59.6% as macroeconomic factors, scams, and a $1.4B Bybit hack push investors toward stability.
Macroeconomic factors, memecoin scams, and the largest hack in industry history prompted investors to shift their wealth to safer assets, such as stablecoins and real-world investments. Last month, Solana saw about $500 million in withdrawals as investors sought more safe digital assets, illustrating the cryptocurrency market’s growing fragility.
In the last 30 days, Solana experienced over $485 million in outflows, primarily as investor funds shifted to Ethereum, Arbitrum, and the BNB Chain.
Market Volatility and the Rise of Bitcoin Dominance
The capital outflow occurred during a broader move towards “safety” within the crypto market, according to a report from Binance Research that was shared. “The report indicated that, in general, there is a wider shift towards safety in cryptocurrency markets, with Bitcoin dominance rising by 1% over the past month to reach 59.6%.”
It noted, “A portion of the funds went into BNB Chain memecoins, partly influenced by CZ’s posts regarding his dog, Brocolli.” Aside from Solana, the whole cryptocurrency market capitalization decreased by 20% in February, driven by rising negative sentiment, according to Binance Research. In addition to macroeconomic concerns, the $1.4 billion Bybit theft on February 21 was the primary catalyst for the drop in crypto investor mood.
Memecoin Scandals and the Shift Toward Stable Assets
Disappointment with the debut of Solana-based memecoins has also dampened investor interest, particularly after the release of the Libra token, which was supported by Argentine President Javier Milei. Insiders of the project reportedly drained more than $107 million in liquidity through a rug pull, causing a 94% price drop in just hours and erasing $4 billion in capital for investors.
“Memecoins have transformed from community-focused social experiments into a tumultuous environment primarily centered around the extraction of value from retail investors,” Anastasija Plotnikova, co-founder and CEO of blockchain regulatory company Fideum, pointed out adding:
“Insider groups, pump-and-dump tactics, and sniper teams have supplanted the genuine, collectible essence of original memecoins, resulting in a detrimental environment.” Stablecoins and real-world assets (RWAs) reached unprecedented levels as investor funds consistently moved into more reliable assets featuring stable pricing or yield-producing mechanisms.
Stablecoins and RWAs Surge Amid Market Uncertainty
According to data, stablecoins exceeded the all-time high of $224 billion, while onchain RWAs reached a cumulative peak of $17.1 billion among 82,000 asset holders as of Feb 3.
Binance Research linked this shift in capital to the recent market volatility: “Affected by macroeconomic elements like rising trade conflicts and lowered hopes for interest rate reductions, the cryptocurrency market has faced a challenging February.” In this kind of environment, investors might opt to cash out some of their investments and maintain stablecoins as a substitute.
Increased unpredictability in worldwide risk assets like Bitcoin. Alexander Loktev, chief revenue officer at P2P.org, an institutional staking and crypto infrastructure provider, pointed out that cryptocurrencies could push RWAs to reach a $50 billion peak in 2025.
