Spot Ether exchange-traded funds (ETFs) in the United States are experiencing their most extended period of outflows since their launch on July 23. According to data from Farside Investors, these ETFs saw continuous outflows for five days straight, from August 15 to August 21, with a total of $92.2 million being withdrawn.
Grayscale Ethereum Trust Leads Outflows
A significant portion of these outflows has been attributed to the Grayscale Ethereum Trust (ETHE), which alone accounted for $158.6 million in withdrawals during the same period. The substantial withdrawals from Grayscale have overshadowed inflows into other newly approved spot Ether ETFs, including those from BlackRock’s iShares Ethereum Trust ETF (ETHA), the Fidelity Ethereum Fund (FETH), and the Bitwise Ethereum ETF (ETHW).
Despite the overall negative trend, ETHA achieved a notable milestone by becoming the first spot Ether ETF to surpass $1 billion in net inflows on August 20. Meanwhile, the Grayscale Ethereum Mini Trust (ETH) has bucked the outflow trend, reporting no withdrawals since its launch and maintaining positive net inflows of $231.9 million.
Ether ETFs’ Volatile Performance
This longest outflow streak follows a period of positive momentum earlier this month when spot Ether ETFs recorded net inflows for the first time. From August 5, the nine spot Ether ETFs collectively saw a net inflow of $104.8 million and traded a total value of $1.9 billion, pushing their total net assets to $7.3 billion as of August 9.
Amidst these fluctuations, ETF issuers are exploring new avenues to bolster their Ether offerings. The New York Stock Exchange (NYSE) American recently proposed a rule change to list and trade options for three Ether ETFs managed by Grayscale and Bitwise. This proposal includes options for the Bitwise Ethereum ETF (ETHW), the Grayscale Ethereum Trust (ETHE), and the Grayscale Ethereum Mini (ETH).
Spot Bitcoin ETFs Show Resilience
In contrast to Ether ETFs, spot Bitcoin ETFs have demonstrated more resilience, maintaining positive flows for eight out of the last ten days. As of August 20, these ETFs saw a cumulative inflow of $88 million, with BlackRock’s iShares Bitcoin Trust leading the charge with $55.4 million in net inflows.
Since their introduction in January 2024, spot Bitcoin ETFs have accumulated net positive flows of $17.5 billion, indicating stronger investor confidence compared to Ether ETFs. The broader interest in spot BTC and ETH ETFs has attracted major financial players like Goldman Sachs and Morgan Stanley, who collectively invested over $600 million in these products during the second quarter.
Recent data from Bitwise also shows that a growing number of institutional investors are strengthening their Bitcoin holdings through spot ETFs. In the second quarter of 2024, around 66% of these investors either maintained or increased their Bitcoin ETF positions, while only 21% reduced their holdings, and 13% exited entirely.
Overall, while spot Ether ETFs face challenges with prolonged outflows, the broader ETF market continues to evolve with a mix of optimism and caution, particularly as investors navigate the complexities of the cryptocurrency landscape.
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