Bitcoin and Ethereum See Strong ETF Inflows

Cryptocurrency News

6 min read time

|Updated: 2026-07-23

Bitcoin and Ethereum See Strong ETF Inflows

The crypto market showed a positive capital picture on July 23, driven by strong ETF inflows into Bitcoin and Ethereum, signaling that institutional interest concentrated in large cap assets. The day's agenda was not limited to price action alone: a security breach at Arbitrum based AFX Trade brought DeFi infrastructure fragility back into focus, while the SEC's securities warning on crypto vaults underscored ongoing regulatory uncertainty. Adding to this picture, Japan's 2028 targeted Bitcoin ETF plan raised the possibility of global institutional adoption expanding into a new front. The day thus presented a multifaceted picture where capital flows, security risks, and regulatory developments were closely intertwined.

Market Context: Institutional Interest Alongside Regulatory Pressure

Institutional capital showed signs of recovery in large cap assets, while participation in smaller cap assets remained limited. This selectivity points to investors managing risk appetite cautiously.

Japan's efforts to reclassify crypto assets as financial investment products suggest the global ETF market could expand into new regions. At the same time, the security breach at AFX Trade and the SEC's statements on crypto vaults show that this growth requires stronger infrastructure and a clearer regulatory framework. Overall, the picture points to a process where institutional access is expanding, yet security and compliance risks continue to test market confidence.

Capital Flows: Ethereum Posts the Day's Strongest Inflow

ETF flows showed an overall positive picture on July 23. Ethereum was the day's strongest asset with a +$72.70 million inflow, while Bitcoin recorded a positive flow of +$69.10 million. Solana saw a limited outflow, while XRP registered neither a net inflow nor outflow.

Bitcoin: +$69.10 million
Ethereum: +$72.70 million
Solana: -$1.30 million
XRP: $0

This distribution shows that institutional capital concentrated in Ethereum and Bitcoin during the day. Ethereum outpacing Bitcoin suggests investor interest is shifting toward a more balanced structure in the short term, while the limited outflow in Solana and the flat reading in XRP show that participation is not spreading evenly across all assets.

AFX Trade Drained of $24 Million in Assets

AFX Trade, an Arbitrum based decentralized perpetual exchange, lost approximately 24.15 million USDC after validator keys for the bridge the protocol operates were compromised.

The incident originated not from Arbitrum's native bridge but from the third party bridge operated by AFX Trade; the smart contract functioned according to its existing rules, but the private keys authorizing the transaction fell under attacker control.
The attacker used five hot validator signatures, meeting the quorum required for the withdrawal, to transfer the funds to their own wallet.
The stolen USDC was moved to the Ethereum network and converted into approximately 12,467 ETH; the stolen amount corresponds to nearly the entirety of AFX Trade's total locked value.

Overall, this development shows that security risks in DeFi protocols can stem more from off chain key management and validator infrastructure than from smart contract flaws, while demonstrating that even though Arbitrum's core infrastructure was unaffected, vulnerabilities in third party protocols on the network can shake user confidence across the ecosystem.

Japan's First Bitcoin ETF on the Agenda for 2028

Japan could launch its first Bitcoin exchange traded fund as early as 2028 as regulators revise investment fund rules.

The Financial Services Agency is moving crypto assets out of the Payment Services Act and into the Financial Instruments and Exchange Act, positioning crypto as a financial investment product rather than mainly a payment tool; Nikkei estimates put potential inflows as high as 3 trillion yen by fiscal 2028.
Major Japanese financial institutions including SBI, Rakuten, Nomura, Daiwa, and Asset Management One have begun preparing crypto investment trusts ahead of the finalized rules; the Osaka Exchange has also said it could bring Bitcoin futures to market in 2028 if spot ETFs become legal.
Institutional participation is expected to remain limited compared to the US; with more than 14 million registered crypto accounts at the FSA and households holding roughly half of their financial assets in cash, demand is expected to come largely from retail investors.

Overall, this development shows that Japan is taking decisive steps toward moving crypto assets into traditional financial product status, while suggesting a different adoption dynamic could emerge, one driven by retail investor demand rather than the institutionally weighted ETF model seen in the US.

SEC Issues Securities Warning on Crypto Vaults

SEC Commissioner Hester Peirce said crypto vaults and onchain lending products that actively manage user assets may fall under US securities laws.

Peirce said vault and lending strategies involving discretionary decisions, such as asset allocation, selecting yield strategies, setting lending terms, and adjusting liquidation thresholds, may fall within the scope of federal securities laws depending on their structure.
She said some vaults could be treated as securities offerings or investment companies, and that parties managing vault allocations or lending parameters could also trigger investment adviser requirements.
Peirce called on developers and operators to consult the SEC to assess whether their products fall under its jurisdiction, noting that crypto vaults have rapidly expanded this year as products aimed at both retail and institutional investors.

Overall, this development shows that onchain finance products are not exempt from traditional securities regulation, while indicating that DeFi vault operators need to prioritize assessing regulatory compliance risks.

CoinTR Insight

Today's picture shows capital inflows concentrating in large cap assets moving in parallel with an advancing security and regulatory agenda. Japan's preparations for its ETF process point to expanding global institutional adoption, while the AFX Trade breach and the SEC's statements on crypto vaults show that infrastructure security and regulatory compliance are rising in priority.

In this environment, CoinTR's deep liquidity structure and stable USDT/TRY trading flow offer users the ability to:

Closely track global and institutional developments,
Execute efficient and secure trades amid shifting market conditions,
Maintain controlled and disciplined positioning while security and regulatory risks persist.

Investor focus is now shifting not only toward price action, but also toward infrastructure reliability and regulatory clarity.

Forward Looking Assessment

The continuation of positive flows into Bitcoin and Ethereum ETFs could support market sentiment in the short term. However, the weaker showing in Solana and XRP suggests capital is not spreading evenly across all assets, and selective participation is likely to continue.

Over the longer term, Japan's regulatory efforts and the SEC's approach to crypto vaults will shape the structure of institutional products. Following the AFX Trade breach, bridge and validator security will also remain a priority risk area; if capital inflows persist and regulatory clarity strengthens, the market could move toward a broader-based growth phase.

2026-07-23

Legal Notice

The information, comments, and evaluations contained in this content do not constitute investment advice. This content is not intended to be prescriptive in any way and is intended to provide general information. It does not constitute investment advice. CoinTR cannot be held responsible for any transactions made based on this information or any losses that may arise.

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