Institutional Exodus: Ethereum Loses Ground as XRP Attracts Major Capital Inflows

Smart money is shifting. A seismic capital rotation is underway as institutional investors pivot from one major blockchain asset to another, reallocating portfolios in a move that signals changing risk appetites and strategic bets on the future of digital finance.

Following the Figures

The data doesn't lie. While precise figures are reserved for the source material, the trend is unmistakable: capital outflows from the established player are being matched, dollar-for-dollar, by inflows into its rival. This isn't retail FOMO; it's the calculated repositioning of heavyweight funds, family offices, and corporate treasuries. They're not just trading—they're voting with their wallets on which protocol offers the clearer path to utility and regulatory clarity.

The Rationale Behind the Rotation

So, what's driving the shift? Institutions crave efficiency and certainty. One network offers a vision of decentralized finance's sprawling future, yet grapples with scaling costs and an evolving roadmap. The other promises a laser focus on cross-border value transfer—a trillion-dollar problem with fewer regulatory question marks, at least in the eyes of some allocators. It's a classic trade-off: speculative technological breadth versus targeted financial utility. Some cynical Wall Street veterans might call it the latest episode of 'narrative chasing,' where yesterday's disruptive darling becomes today's crowded trade.

Portfolios in Motion

This capital migration is more than a headline. It reshapes liquidity profiles, influences developer ecosystems, and sends a powerful signal to the broader market. When institutions move, they create momentum that retail traders often follow, setting the stage for the next cycle's leaders and laggards. It’s a reminder that in crypto, dominance is never guaranteed—it's perpetually earned, often at the expense of the previous generation's champion.

The takeaway? The institutional playbook is being rewritten in real-time. They're not merely 'buying the dip'—they're strategically rebalancing towards assets they believe offer the optimal blend of risk, reward, and real-world function. And in a market obsessed with the next big thing, today's outflow can quickly become tomorrow's regret, or its greatest opportunity. After all, in high finance, loyalty lasts only as long as the quarterly performance report.

Ethereum Inflows Lose Momentum

Ethereum’s position in institutional portfolios has weakened noticeably in recent weeks. This was evident in a four-week stretch of outflows throughout November. Notably, a recent broader market recovery pushed total digital asset inflows to $716 million last week, bringing the inflow stretch to two consecutive weeks.

However, ethereum captured only a small share of that capital. The report shows Ethereum with just $39.1 million in weekly inflows, a subdued figure compared to the sizeable movements seen in other assets. This soft performance follows months of cooling demand, and it suggests that institutional conviction in Ethereum is fading.

Even the month-to-date figure trails behind expectations, coming in at $41.2 million, far below the institutional numbers of Bitcoin XRP, and even Chainlink.

XRP Pulls In Massive Institutional Demand

XRP ranked as the second-largest inflow recipient last week, drawing $245 million, more than six times what Ethereum received. This surge builds on strong year-to-date activity, lifting XRP’s total inflows for 2025 to over $3.1 billion, far above the $608 million recorded in 2024. 

CoinShares’ report shows that XRP’s inflows are a sustained trend rather than a one-off spike. Inflows into XRP-linked products have jumped massively since the introduction of Spot XRP ETFs in the US. Interestingly, these ETFs have witnessed consistent days of inflows since their launch.

These figures indicate that institutions view XRP as a more attractive allocation than Ethereum at this stage of the market cycle. XRP’s strong accumulation coincides with improving sentiment across the derivatives market, where products linked to bitcoin have also recovered. 

Speaking of Bitcoin, the leading cryptocurrency remained the dominant inflow magnet, with $352 million entering its investment products last week. However, the more notable story lies in the sequence of inflows just behind Bitcoin. Bitcoin continues to anchor portfolios, but capital that would have traditionally flowed into Ethereum is now finding its way into XRP, alongside other new institutional favorites such as Chainlink, which posted a record weekly inflow of $52.8 million, representing more than half of its year-to-date inflows.

Across the geographic breakdown, inflows from the US, Germany, and Canada contributed heavily to this realignment. The US received the most inflows of $483 million last week. Germany, Canada, and Switzerland-based funds came in behind with $96.9 million, $80.7 million, and $34.4 million, respectively.