Ethereum
Ethereum ETFs Hit $107M in Inflows in Debut: “A Very Strong First Day”
Ethereum spot exchange-traded funds in the U.S. have only been trading for a day, but new data from Bloomberg shows they are off to a “solid” start.
Despite substantial outflows from Grayscale’s Ethereum Trust (ETHE) exceeding $484 million, combined total inflows from eight other competitors pushed performance into positive territory.
Funds owned by BlackRock (ETHA) and Bitwise Asset Management (ETHW) led the way, with $266 million and $204 million, respectively, bringing total inflows, excluding Grayscale, to $590 million.
“Ethereum ETFs raised $107 million,” said Bloomberg analyst James Seyffart. tweeted Tuesday, along with ETF data. “A very solid first day.”
Full-day trading volume for the funds also topped $1.1 billion, doubling the $600 million figure reached midway through Tuesday, the data showed. watch.
In May, the U.S. Securities and Exchange Commission gave preliminary approval to ETF issuers, paving the way for the funds to be listed on exchanges, much to the surprise of crypto industry participants at the time.
With the initial excitement over the approval now gone, some analysts predict that significant assets will flow into the funds over the next year, bolstering their total assets under management.
“We could see a total of $5 billion to $10 billion in assets under management over the next 12 months,” said Katalin Tischhauser, head of investment research at digital asset banking group Sygnum Bank. Decrypt.
“However, it is likely that demand for new types of investors will be felt more in the first half of 2025 than in this year,” Tischhauser said. “Hedge funds will probably be the ones that evolve the fastest.”
The scope and scale of ETH ETF takeovers are likely to be affected by the direction and pace of change in the U.S. policy and regulatory environment against the crypto industry, she said.
The political winds have shifted dramatically in recent months, with Vice President Kamala Harris now tipped to lead the Democratic Party in its fight against former President Donald Trump for a bid for the White House.
President Joe Biden’s decision to reverence This week’s presidential race has renewed optimism among crypto industry insiders about a more favorable approach to regulation under a Trump administration.
Despite the changing political landscape, Ethereum ETFs will need to see increased inflows to prove they are an attractive market for large investors, said Ryan McMillin, chief investment officer at crypto fund manager Merkle Tree Capital. Decrypt.
“The run-up to Ethereum was different than Bitcoin, as Bitcoin rallied when its ETFs launched and then sold off when entities left Grayscale,” he said.
“Ethereum hasn’t really rallied in its launch. It’s been overbid,” McMillin added. “Now we need to see sustained demand. That’s the real test.”