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U.S.-listed ethereum (eth) exchange-traded funds (ETFs) recorded $476 million in negative net flows during the first month of trading, failing to overcome outflows resulting from Grayscale’s ETHE unlocking.
Bloomberg senior ETF analyst Eric Balchunas praised the “heroic” performance of Newborn Nine’s bitcoin (btc) ETFs, which saw enough inflows to largely eclipse the massive outflows experienced by GBTC.
The performance contrasts sharply with the $5 billion inflows seen by bitcoin ETFs over a similar period after their launch.
Analysts have attributed this disparity to several factors, including bitcoin’s “first-mover advantage,” the absence of staking options in ethereum ETFs, and lower liquidity in the ethereum market, making these ETFs less attractive to institutional investors.
Despite these challenges, some ethereum ETFs showed signs of recovery towards the end of the month. Balchunas added that outflows will not continue forever and that inflows from newly launched ETFs will eventually catch up with outflows. He said:
“But the good news is that the unblocking will end, there is light at the end of the tunnel.”
More than 2 billion dollars in tickets
Grayscale's ETHE lost nearly $2.6 billion in its first month, according to Farside Investors ethereum-etf-flow-all-data/”>dataThe move was expected, as the same thing happened with its bitcoin trust GBTC.
While inflows into other Ether ETFs were not enough to ensure a positive monthly net flow, the amount of cash directed into these crypto products has been significant nonetheless.
BlackRock's ETHA surpassed $1 billion in inflows, making it the seventh-largest ETF by flows so far this year, according to a shared list.
Fidelity’s FETH also saw significant inflows of approximately $393 million, making it the 19th largest ETF by inflows so far this year, while Bitwise’s ETHW is the third and final US-traded ethereum ETF that managed to capture over $300 million in inflows during its first year.
Furthermore, despite Grayscale's massive ETHE outflows, its mini ethereum trust, eth, managed to raise almost $240 million in tickets.
If total inflows into US-listed ethereum ETFs were pooled into a single product, they would equal the flows of the fourth-largest exchange-traded fund in 2024.
