Cryptocurrency Flows Surge to $785 Million in the Past Week Driven by Ethereum Pectra Upgrade
The cryptocurrency market continues to see strong capital inflows, with total inflows hitting $785 million in the week ending May 17. This is the fifth consecutive week of positive inflows, bringing the year-to-date (YTD) total to $7.5 billion — marking a full recovery from the drawdown in February and March.
Ethereum Leads the Way as Investor Sentiment Improves Following Pectra Upgrade
According to CoinShares’ latest report, Ethereum was the biggest bright spot this past week, attracting $205 million in inflows, a significant jump from the previous week’s $1.5 million. Researcher James Butterfill notes that investor optimism is driven by two key factors: the successful Pectra upgrade and the appointment of Tomasz Stańczak as co-CEO of the Ethereum Foundation.
The Pectra upgrade, which rolled out on the Ethereum mainnet on May 7, is considered the biggest change since The Merge in 2022. EIP-7251 raises the validator stake limit to 2,048 ETH, while EIP-7702 introduces smart wallets, paving the way for account abstraction — a major step forward in Ethereum’s development roadmap.
Tomasz Stańczak, the new co-CEO of the Ethereum Foundation, is a veteran of Ethereum infrastructure development. He focuses on a “statelessness” strategy to improve the scalability and decentralization of the network — a vision that could be a turning point in Ethereum’s technical direction going forward.
Bitcoin Still Dominant, but Influenced by Economic Signals
While Ethereum is the clear winner, Bitcoin still leads in total inflows with $557 million in inflows, down slightly from the previous week. CoinShares suggests the decline could be related to “hawkish” signals from the US Federal Reserve, causing investors to adjust their short-term strategies. Notably, short Bitcoin investment products recorded their fourth consecutive week of inflows, with a total of $5.8 million — indicating investors remain cautious amid volatile prices.
US leads in outflows, Solana records outflows
Geographically, the US continues to dominate with $681 million in outflows, far ahead of Germany ($86.3 million) and Hong Kong ($24.2 million). This reflects the positive sentiment of North American investors, despite recent geopolitical uncertainties and tax policies.
Meanwhile, Solana bucked the trend with negative outflows of $0.89 million. This is not a very positive sign as the Solana ecosystem is also witnessing a 64% decline in total value locked (TVL), indicating profit-taking pressure and a decline in confidence in the short term.
Conclusion
Positive outflows continue to be an important indicator of a solid recovery in the crypto market. With the impetus from the Ethereum Pectra upgrade and a change in leadership strategy, Ethereum may be entering a new growth phase. Meanwhile, investors continue to closely monitor macroeconomic variables, especially US interest rate policy, to make more effective capital allocation decisions in the coming time.