Ethereum ETFs Debut with Record $1 Billion Trading Volume
What’s the Future Outlook for Ether ETFs?
The newly launched spot Ether (ETH) exchange-traded funds (ETFs) had a remarkable debut, attracting substantial net inflows despite significant outflows from Grayscale’s Ethereum Trust.
Initial Success for Ether ETFs
On their first day of trading, Ether ETFs in the United States saw a net inflow of $106.6 million. This was achieved despite Grayscale’s Ethereum Trust experiencing a $485 million outflow.
Leading ETFs: BlackRock and Bitwise
BlackRock and Bitwise led the pack:
BlackRock’s iShares ETF (ETHA): $266.5 million in net inflows
Bitwise’s Ethereum ETF (ETHW): $204 million in net inflows
Other Notable Inflows
Fidelity’s Ethereum Fund (FETH): $71.3 million
Franklin Templeton’s Fund (EZET): $13.2 million
21Shares’ Core Ethereum ETF (CETH): $7.4 million
Overcoming Grayscale's Outflows
The net inflows to the new spot Ether funds were sufficient to offset the substantial outflows from Grayscale’s Ethereum Trust (ETHE). The ETHE, once valued at $9 billion, saw $484.9 million in outflows, equivalent to 5% of the fund's value.
Impact of Spot ETF Conversion
Grayscale’s Ethereum Trust, launched in 2017, allowed institutional investors to buy ETH but included a six-month lock-up period. The recent conversion to a spot ETF format now allows easier selling of shares, which likely contributed to the high first-day outflows.
This dynamic mirrors the January launch of spot Bitcoin ETFs, where Grayscale’s Bitcoin Trust (GBTC) faced over $17.5 billion in outflows after the debut of 11 spot BTC funds.
Trading Volume and Market Impact
Overall, the spot ETH funds accumulated $1.08 billion in trading volume on their first day, representing 23% of the volume seen by spot Bitcoin ETFs on their debut. Despite this positive reception, the price of ETH saw a slight decline, trading at $3,437.19 at the time of publication, down 0.47% in the last 24 hours and 1.38% over the week.
The Ether ETFs, approved by the SEC on July 22 and launched for trading on July 23, have shown a strong start. Their ability to attract significant inflows, despite the outflows from Grayscale’s Ethereum Trust, highlights the growing interest and confidence in spot Ether ETFs.
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