Ethereum ETFs Debut: BlackRock Reigns With $260M Inflows, Grayscale Bleeds
24 Juillet 2024 - 9:12PM
NEWSBTC
Nine spot Ethereum ETFs commenced trading on the US stock market on
Tuesday, marking a pivotal moment for the crypto industry following
the Securities and Exchange Commission’s (SEC) green light on
Monday. Ethereum ETFs See $1B In Trading Volume On Debut James
Seyffart, a senior ETF analyst at Bloomberg, described the Monday
ETF launch as a “pretty big success,” according to a Fortune
report. However, the initial enthusiasm was tempered by a stark
comparison to Bitcoin’s ETF debut earlier this year, which garnered
$655 million in inflows on its first trading day. Related Reading:
Mt. Gox Creditors Opt To HODL Bitcoin Rather Than Sell, CryptoQuant
Data Shows Diving into the specifics, the Ethereum ETFs
collectively amassed $10.2 billion in assets, with trading volumes
surpassing $1.1 billion on day one. Grayscale’s Ethereum Trust
(ETHE) led the volume race with $469.7 million. Among the key
players, BlackRock led the charge with $266 million in inflows,
followed closely by Bitwise with $204 million and Fidelity with $71
million. Despite these figures, the ETFs collectively
witnessed net inflows of $107 million, overshadowed by Grayscale’s
Ethereum Trust’s outflows of $484 million, as per Bloomberg data.
However, the market response to the ETFs did not translate into a
noticeable impact on Ethereum’s price, which experienced a marginal
0.8% decline since trading commenced. Currently, the second
largest cryptocurrency on the market is trading at $3,420, with a
27% decrease in trading volume in this area, amounting to $16
billion in the last 24 hours, and no significant changes to
Tuesday’s price value per coin. Bright Future Despite
Challenges Given that Ethereum’s market cap is a fraction of
Bitcoin’s, the comparatively smaller inflows were somewhat to be
expected. In addition, the Fortune report noted that the lack
of a staking feature in the ETFs, which is prohibited by the SEC,
also drove some investors to buy Ethereum directly, bypassing the
new Ethereum ETFs mechanism. Another strong reason for the outflows
on the first day of the ETHE fund is Grayscale’s 2.5% fee compared
to competitors charging 0.25% or less, a factor that is believed to
have influenced investor behavior and contributed to ETHE’s
outflows. Related Reading: Forget $10,000, Crypto Analyst Says Spot
Ethereum ETFs Will Drive ETH To $14,000 Despite the lack of market
response, Seyffart remains optimistic about the reception of the
Ethereum ETFs, citing the strong performance of “smaller players”
such as 21 Shares’ Core Ethereum ETF, which attracted $8.7 million
in inflows. Seyffart said to Fortune: Very successful launch day by
any standard ETF’s first day of trading. On top of this, the volume
numbers were very strong. Adding to the optimistic outlook
for the Ethereum ETFs, it is noteworthy that Bitcoin (BTC) surged
to an all-time high of $73,700 on March 14, just two months after
the approved ETFs started trading. Although ETFs investing in
ETH’s price may not attract as much inflow and trading volume as
BTC, this could lead to a sustained increase in ETH’s price in the
long term. Featured image from DALL-E, chart from
TradingView.com
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