- Ethereum ($ETH) exchange-traded funds (ETFs) had positive overall net inflows of $104.8M for the week beginning August 5.
- BlackRock’s iShares Ethereum Trust ETF (ETHA) is leading the pack with approximately $188.3M in inflows. However, major outflows from Grayscale Ethereum Trust (ETHE) offset the total weekly inflows.
- ETF analyst Eric Balchunas emphasized that deep liquidity during the recent market downturn will benefit ETFs in the long term.
The nine newly launched US spot $ETH ETFs had their first week of positive net inflows since July 23, reaching $104M. The total trading volume for these ETFs hit $1.9B, bringing the total net assets to $7.3B by August 9.
$ETH ETFs Witness Meager Inflows
Net outflows from $ETH ETFs reached $405M by August 9. $ETH ETFs saw three consecutive days of outflows, while $BTC ETFs experienced two consecutive days of inflows. It shows that investor sentiment had shifted from $ETH to $BTC ETFs.
$BTC inflows came amid the 23% $ETH price decline since the beginning of August.
However, not all $ETH ETFs performed equally. Six of the nine funds recorded positive weekly net flows, with BlackRock’s ETF (ETHA) leading the pack with approximately$188.3M in net inflows.
According to Farside Investors UK’s data for August 8, Blackrock’s ETHA saw the highest inflows of $19.6M, followed by Fidelity’s FETH with $3.8M. Meanwhile, the Grayscale Ethereum Mini Trust (ETH) recorded the lowest inflow of $2.4M.
On August 9, $41.7M outflows from Grayscale’s ETHE have offset inflows. Other ETFs saw no activity that day.
Cumulative outflows from Grayscale’s ETHE are nearing $2.3B, which heavily influences the collective cumulative outflows of spot $ETH ETFs, standing at $406.4M by July 30.
BTC Spot ETF Trends
The 12 spot $BTC ETFs saw net outflows of $89.7M on August 9 after two days of inflows.
Grayscale’s $BTC ETF (GBTC) and Fidelity’s Bitcoin Fund (FBTC) saw the highest outflows of $77M and $19.8M, respectively. Bitwise Bitcoin ETF (BITB) had the third-largest net outflow of $18.1M.
Crypto ETFs Fall to Recession Fears?
High trading volume in spot $BTC ETFs amid market downturns may indicate market fear. Eric Balchunas, an ETF analyst at Bloomberg, highlighted that deep liquidity amid bearish sentiment is valuable to both traders and institutions and will benefit ETFs in the long term.
Bitcoin ETFs have traded about $2.5b so far, a lot for 10:45am, but not too crazy (full history below). If you bitcoin bull you actually DONT want to see crazy volume today as ETF volume on bad days is a pretty reliable measure of fear. On flip, deep liquidity on bad days is part… pic.twitter.com/TOQRjyriqp
— Eric Balchunas (@EricBalchunas) August 5, 2024
Final Thoughts
The recent global stock market sell-off and geopolitical uncertainties fueled skepticism toward digital asset investment products. Will the significant outflows from $ETH ETFs become a turning point for crypto ETFs? We’ll have to wait and see.
References
Disclaimer: The opinions expressed in this article do not constitute financial advice. We encourage readers to conduct their own research and determine their own risk tolerance before making any financial decisions. Cryptocurrency is a highly volatile, high-risk asset class.
