Ethereum ETFs Aren't Like Bitcoin ETFs (So Far)

A few months after the SEC gave the initial green light, ethereum spot ETFs officially began trading last Tuesday.

However, the immediate results have been quite disappointing and one cannot help but compare them to the launch of the bitcoin ETF in January this year.

eth ETF vs btc ETF

Cryptopotato Earlier this week, it was reported that all nine ethereum spot ETFs had a solid first day, gathering over $106 million in net flows. As expected, the converted Grayscale fund (ETHE) saw substantial withdrawals of nearly $500 million, but flows to the rest (especially ETHA and ETHW) managed to ease the pain.

However, the next three days were very different, as the trend quickly changed. Instead of total inflows, the daily figures turned red, with $133.3 million withdrawn on July 24, $152.4 million withdrawn on July 25, and $162.7 million withdrawn on July 26.

This is a worrying trend as cash outflows are on the rise. Grayscale’s ETHE lost $326.9 million, $346.2 million, and $356.3 million respectively in those three days.

However, demand for the remaining products, including BlackRock’s ETHA and Fidelity’s FETH, has been declining and has been unable to offset the massive ETHE withdrawals. As a result, figures after the first four days of trading show that $341.8 million has been withdrawn from ethereum spot ETFs.

There is a stark contrast compared to the first four days of bitcoin spot ETFs. More than $650 million in inflows were recorded on the launch date, $203 million on the second day, and $453.8 million on the fourth. Only the third day saw minor outflows ($52.7 million). The net flows in total were close to $1.26 billion in just four days, highlighting the huge difference compared to ethereum ETFs.

What about price performance?

While the difference in demand for the two largest cryptocurrencies is more than evident (at least for now), the price performance of the underlying assets during the first few days of trading after the launch of their respective ETFs has been unexpected.

With over $1.25 billion entering the btc ecosystem, one would imagine that the price of bitcoin would be on the rise. But they would be wrong. The cryptocurrency shot up from $45,000 to $49,000 after the ETFs hit the markets on January 11, but crashed to $41,300 on the fourth day.

On the other hand, eth started with a price drop from $3,500 to $3,000, which was somewhat expected given the outflows, but bounced back and is currently hovering near $3,300. As such, ether is down just 6.5% now, despite substantial outflows, while btc plummeted 16% despite ETFs being a massive success in their early days.

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