Spot Ethereum ETFs See First Green Day After Four-Day Decline
After four consecutive days of losses, spot Ethereum ETFs (Exchange-Traded Funds) have finally recorded their first positive day. Just a week after their launch, significant outflows, particularly from Grayscale’s Ethereum Trust (ETHE), overshadowed the promising start of ETH-based investment products.
Ethereum ETFs Performance Marred by Outflows
The approval of spot Ethereum (ETH) ETFs sparked debates about their demand and expected performance post-launch. Many experts doubted these investment products would match the success of Bitcoin-based counterparts, citing a lack of a clear narrative, media attention, and demand.
Figures like Bitwise’s CCO Katherine Dowling and entrepreneur Anthony Pompliano predicted Ethereum ETFs would only achieve 20%-30% of the results seen with BTC-based funds. Despite these predictions, Ethereum ETFs had a strong start, aligning with expert expectations on their first day. They recorded $1.05 billion in volume, about 24% of what Bitcoin ETFs did on their launch day, and $107.8 million in inflows, despite ETHE’s $484 million net outflows.
However, by their second day, Ethereum ETFs posted negative numbers, with a 5% volume drop on Wednesday and a $113.3 million negative net flow. Despite the outflows, some analysts noted that the volume held up better than expected post-day-one frenzy.
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Data from Farside Investor indicated that ETH ETFs’ outflows surpassed positive net flows in subsequent days. By July 29, these products averaged a daily outflow of $137.8 million, totaling $440.1 million across all nine ETFs.
Positive Turn After Four-Day Negative Streak
The four-day negative streak ended on July 30, when spot Ethereum ETFs reported their first green day since launch. Blackrock’s iShares Ethereum Trust (ETHA) led with $118 million in inflows, contributing to a positive net flow of $33.7 million on Tuesday. ETHE had a negative net flow of $120 million, the lowest since the ETFs launched, marking a 75% decline from its $480 million outflow on day one. This suggests Grayscale’s substantial losses, totaling around $1.84 billion on July 30, might be stabilizing, with potential for a continued positive trend.
Meanwhile, ETHA emerged as the best-performing Ethereum ETF after recovering from a lackluster second day. A week post-launch, it boasted a total positive net flow of $618.2 million. ETF Store President Nate Geraci highlighted that ETHA ranks in the top 15 inflows among approximately 330 new ETFs launched this year. “Top 15 out of approx. 330 new ETFs. Top 4 inflows all spot bitcoin ETFs, btw,” his post reads.
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Senior crypto analyst at Steno Research, Mads Eberhardt, noted that Blackrock’s ETHA and Fidelity’s FETH had attracted one-third of the inflows of their respective Bitcoin counterparts, despite several disadvantages. These included less attention to Ethereum ETFs, an inopportune launch month, market awareness of Grayscale’s mandatory short-term Ethereum ETF drainage, and Ethereum’s smaller market cap and liquidity compared to Bitcoin at launch.
Eberhardt believes that outflows from spot Ethereum ETFs will diminish by the end of this week, predicting, “When it does, it’s up only from there.”
David Ma was born in 1980 in California, is a Vietnamese American, known as one of the entrepreneurs and investors in the field of cryptocurrency and stock market. In 2006, he graduated from Stanford University with honors and began his career in business.
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