Institutional Investors Buy ETH Dip As Spot ETF Flows Turn Positive

U.S. local Ethereum ETFs had a positive day of inflows after a massive market decline sent the asset tumbling 23% in less than 24 hours.

On August 5, the aggregate inflow of the nine newly launched spot ETH ETFs was $49 million, the second highest inflow day since the funds began trading.

Also, it’s only the fourth day of inflows in the last ten trading days, suggesting that institutional investors were effectively buying Ethereum lower.

Additionally, the idea was confirmed by ETF specialist James Seyffart in a post on X on August 6.

“ETF investors, as a whole, probably bought the drop in Ethereum today.”

Buyers of Ethereum Dip

BlackRock’s ETHA fund led the pack with inflows of $47.1 million, bringing the total flow of funds into the product to $760 million. VanEck’s ETHV fund had inflows of $16.6 million, followed closely by Fidelity’s FETH at $16.1 million.

The Bitwise ETHW fund had $7.2 million, while $7.6 million flowed into the Grayscales Ethereum Mini Trust (ETH). ETHE’s main grayscale fund saw an outflow of $46.8 million, its lowest to date since becoming a one-time ETF.

Ethereum ETF Flow (Millions of US Dollars) – 2024-08-05

TOTAL NET HORSEPOWER: 48.8
(provisional data)

ETHA: 47.1
FETH: 16.2
ETHW: 7.2
CETH: 0
ETHV: 16.6
QETH: 0
EZET: 0.9
ETH: -46.8
ETH: 7.6

For full details and disclaimers visit: https://t.co/HfqQHgwr3Z

— Farside Investors (@FarsideUK) August 6, 2024

However, there was not the same buying of Bitcoin funds that saw an outflow of $168.4 million on Monday, according to preliminary data from Farside Investors.

Fidelity, Ark 21Shares and Grayscale saw outflows of between $58 million and $70 million, while BlackRock and four of the others reported zero flows.

Grayscale’s Mini Bitcoin Trust saw a minor inflow of $21.8 million, and there was about $3 million each for Bitwise (BITB) and VanEck (HODL).

Bitwise CIO Matt Hougan commented on the drop in purchases of both funds, but investors were mainly interested in ETH.

Today we had net inflows into our Bitcoin and Ethereum ETFs. ETF investors buying the dip.

— Matt Hougan (@Matt_Hougan) August 6, 2024

ETH Price Outlook

Ethereum markets were hit yesterday with assets closing at their lowest price in 2024 at $2,171 on August 5th. It was the steepest and fastest drop in ETH prices since May 2022, dumping assets by 34% in less than a week.

However, markets have shown signs of recovery during the Asian trading session on Tuesday morning with ETH retrieving $2,500.

For the uptrend to continue, it needs to reach and break the $2,900 resistance, although this could take some time, especially if Bitcoin is slow to recover.

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