The spot Ethereum ETFs were given the green light by the SEC a few months ago, and they officially launched last Tuesday. However, the initial results have been quite underwhelming, especially when compared to the launch of spot Bitcoin ETFs earlier this year. While the spot Ethereum ETFs saw a solid first day with over $106 million in net flows, the following days painted a different picture.
In the days following the launch, the trend quickly shifted from inflows to outflows. On July 24, $133.3 million was taken out, followed by $152.4 million on July 25, and $162.7 million on July 26. The outflows continued to grow, with Grayscale’s ETHE seeing the largest withdrawals. Despite some of the other ETFs like ETHA and ETHW managing to mitigate the losses, overall, the spot Ethereum ETFs lost a total of $341.8 million in the first four days of trading.
The contrast between the spot Ethereum ETFs and the spot Bitcoin ETFs is stark. The Bitcoin ETFs saw over $1.250 billion in net flows within the first four days of trading, showcasing a much higher demand compared to Ethereum. While Bitcoin’s price saw a slight increase followed by a slump after the ETF launch, Ethereum’s price performed unexpectedly well, only down by 6.5% despite the outflows.
Bitcoin’s price surged from $45,000 to $49,000 after the ETFs hit the market but then dropped to $41,300 by the fourth day. On the other hand, Ethereum initially dropped from $3,500 to $3,000 but managed to bounce back and is currently trading close to $3,300. Ethereum’s resilience in price performance despite the substantial outflows is notable, especially when compared to Bitcoin’s sharp decline.
The disappointing launch of the spot Ethereum ETFs raises concerns about the demand for Ethereum compared to Bitcoin. While the initial response was promising, the subsequent outflows and diminishing demand paint a concerning picture. However, Ethereum’s resilience in price performance post-launch could hint at potential stability and growth in the future.
The launch of Ethereum spot ETFs has been met with mixed results, with initial excitement giving way to growing outflows and diminished demand. The stark contrast with the launch of Bitcoin ETFs highlights the differing demand for the two cryptocurrencies. Despite the challenges, Ethereum’s price resilience post-launch offers a glimmer of hope for the future of Ethereum spot ETFs.