Here’s the fallout after the first days of trading for Spot Ethereum ETFs

Although we still have a long way to go in 2024, this year has already been quite an eventful one for the cryptocurrency industry and not just for Bitcoin.

The second-largest digital asset also received a massive dose of validation earlier this year, when the U.S. Securities and Exchange Commission gave the green light to nearly ten exchange-traded funds that track its performance. The first few days of trading, however, have been quite disappointing.

The ETH ETFs were initially given the green light a few months ago, but due to some regulatory paperwork that needed to be lined up, they finally launched on US exchanges on July 23rd.

The first day of trading saw substantial volumes and $106.6 million in total inflows, although $484.1 million came out of the converted Grayscale (ETHE) fund. This is because BlackRock’s ETHA ($266.5 million) and Bitwise’s ETHW ($204 million), among others, managed to offset Grayscale’s losses.

However, these positive flows were short-lived and the tides turned in the next three days. FarSide data shows that while Grayscale’s ETHE continued to see substantial outflows ($326.9 million on July 24, $346.2 million on July 25, and $356.3 million on July 26), the flows of the remaining ETFs cannot be caught up.

Overall, totals for those days were $133.3 million, $152.4 million, and $162.7 million, respectively. What is particularly worrying is that withdrawn funds are increasing.

Bloomberg ETF specialist Eric Balchunas acknowledged the difficult early days for all Ethereum spot ETFs, but saw some positives in the performance of the so-called “new eight” products, all ETFs recently launched in part of the Grayscale convert.

The “New Eight” Ether ETFs are not as strong as the “Nine Nine” Bitcoin ETFs to compensate for the grayscale exits, but the good news is that their flows/volume are still very healthy and the intensity of the $ETHE unlock will turn off sooner than w did $GBTC = good prospects, but the next… https://t.co/DnOsKsouzP

— Eric Balchunas (@EricBalchunas) July 26, 2024

The good thing about ETH is that it managed to recoup most of the losses induced earlier this week when it fell from $3,500 to $3,000 in hours amid ETF outflows. As of now, ether is trading near $3,300.

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