The Ethereum market has been experiencing significant activity in the recently launched US spot Ethereum exchange-traded funds (ETFs). Grayscale’s Ethereum Trust saw a staggering $1.5 billion in net outflows since its conversion into an ETF, while BlackRock’s Ethereum Trust attracted $442 million in net inflows, leading the pack among the new US Ethereum ETFs. These ETFs had a rocky start, with approximately $1.5 billion being pulled from Grayscale’s fund in the first week of trading. Despite this, all US spot Ethereum ETFs ended the week with nearly $342 million in net outflows, with BlackRock’s Ethereum Trust drawing $442 million in inflows.
The Grayscale Ethereum Trust (ETHE) witnessed a significant trading volume of over $450 million on its first trading day as an ETF, which accounted for almost half of the total trading activity. Data later revealed that investors withdrew over $480 million from the ETF on its first trading day. However, other ETFs received significant inflows, with BlackRock’s iShares Ethereum Trust (ETHA) leading the way with $590 million in net inflows. Even with the outflows from Grayscale’s ETHE, US spot Ethereum ETFs attracted nearly $107 million in total inflows on their first day.
The flow of funds in Ethereum ETFs fluctuated significantly, with sharp reversals in flows after a strong debut. The outflows from Grayscale’s ETHE continued, totaling about $1.5 billion since its conversion, whereas other spot Ethereum ETFs received substantial inflows. BlackRock’s ETHA attracted $442 million, followed by Bitwise’s ETHW at $265 million and Fidelity’s FETH at $219 million. Grayscale’s Ethereum Mini Trust (ETH) saw a steady increase in net inflows, indicating a shift of assets to lower-cost alternatives.
As the Ethereum ETF market enters its second week, Grayscale’s ETHE is expected to continue experiencing outflows, while the new Ethereum ETFs gradually attract more investors and volume. Bloomberg ETF analyst Eric Balchunas anticipates an improvement in the situation over time, although the next few days could remain challenging due to ongoing outflows from ETHE. Unlike Bitcoin, the market capitalization of Ethereum is less sensitive to new investment inflows, according to a report by CryptoQuant. The recent EIP-1559 upgrade has impacted Ethereum’s supply and its deflationary nature, potentially affecting its price performance.
Despite the challenges and fluctuations in the Ethereum market, the cryptocurrency has shown resilience, recovering from a 10% drop following the spot Ethereum ETF debut. ETH is currently trading at around $3,300, up over 4% in the last 24 hours. The flow of funds in Ethereum ETFs and the overall market dynamics will continue to evolve, offering investors new opportunities and challenges in the fast-paced world of cryptocurrencies.
