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The U.S. Securities and Exchange Commission's continued delay in approving trading of spot ethereum exchange-traded funds (ETFs) caused ethereum ETFs to record their most significant outflows in two years.
According to the latest CoinShares digital asset fund reportThese outflows resulted in a third consecutive week of negative flows of $30 million for global cryptocurrency-related investment products.
However, James Butterfill, head of research at Coinshares, noted that last week's modest flow suggested “a significant reduction in outflows.”
Meanwhile, the negative sentiment had little impact on transaction volume for these products, which rose 43% week-on-week to $6.2 billion. However, this figure is still significantly lower than the weekly average of $14.2 billion.
ethereum records highest outflows in 2 years
ethereum outflows hit $61 million last week, the highest since August 2022. Over the past two weeks, eth outflows totaled $119 million, making it the worst-performing asset in the year-to-date metric, with a negative net flow of $25 million.
Butterfill attributed the outflows to negative investor sentiment surrounding the current uncertainty over when ethereum ETF products would begin trading. On June 28, Bloomberg ETF analyst Eric Balchunas x.com/EricBalchunas/status/1806810886109331520?t=A4k9KVKIeJBnJ3s1sOd2jg&s=19″>noted that approval of the financial instruments could be further delayed until the week of July 8 because the SEC and some applicants were still ordering documents.
bitcoin benefited from this shift in sentiment, with inflows totaling $10 million last week. CoinShares’ report noted that most bitcoin ETF providers, including BlackRock’s IBIT and Fidelity’s FBTC, saw modest inflows, which partially offset the $153 million outflow from Grayscale’s GBTC fund.
The positive sentiment also triggered $4.2 million in exits from bitcoin short positions. Additionally, market observers noted that btc’s price struggles might have attracted significant attention from these bearish traders.
Large-cap alternative digital assets like Solana and Litecoin also saw minor inflows of $1.6 million and $1.4 million, respectively. Meanwhile, Butterfill added:
“Blockchain stocks, despite positive sentiment for cryptocurrencies this year, have suffered outflows of $545 million this year, representing 19% of assets under management.”
