In the last four weeks, Ethereum (ETH) exchange-traded funds (ETFs) have seen inflows surpassing $2 billion, as reported by Farside Investors’ data. This impressive number does not take into account the nearly $2.5 billion outflows from Grayscale’s ETHE. ETF Store CEO Nate Geraci pointed out that if all these inflows were considered under one ETF, it would be the fourth-largest ETF launch ever. The three ETF launches that have surpassed the cumulative value of Ethereum ETFs are all spot Bitcoin (BTC) ETFs.
Bloomberg senior ETF analyst Eric Balchunas stated that the ETFs’ year-to-date flows have reached $911 billion worldwide. The US-traded spot crypto ETFs have seen a net inflow of $17 billion, representing almost 2% of total global flows. IBIT is currently the third-largest ETF by inflows, approaching $20.5 billion, while FBTC has seen nearly $10 billion in inflows, placing it among the largest funds in the market.
Despite the impressive numbers for Ethereum ETF inflows, they are still trailing behind their Bitcoin counterparts. Ethereum’s weak performance over the past few weeks, with a 40% decrease in value in the last month, has been cited as one of the reasons for this lag. Bitfinex analysts reported that Jump Crypto, Wintermute, and Flow Traders have collectively sold 130,000 ETH since the launch of Ethereum ETFs. Additionally, the recent interest rate hike in Japan has shaken the macroeconomic landscape, leading to a decrease in risk appetite in the market.
Aurelie Barthere, Principal Research Analyst at Nansen, shared with CryptoSlate that the market sell-off in March resulted in significant realized losses, particularly for traders involved in multiple crypto narratives. Another sell-off between July and August highlighted a growing correlation with equities, putting further pressure on Ether amidst solid but slowing growth in the United States and stretched valuations in traditional risk assets like US equities.
Overall, the strong inflows into Ethereum ETFs in recent weeks reflect the growing interest in cryptocurrency investments, particularly in major assets like Ethereum and Bitcoin. Despite the challenges faced by Ethereum in the current market environment, the inflows into ETFs continue to show confidence in the long-term potential of the asset. As the cryptocurrency market evolves and adapts to changing macroeconomic conditions, it will be interesting to see how Ethereum and other digital assets continue to perform in the ETF space.
