Ethereum (ETH) exchange-traded funds (ETFs) posted their largest outflows since July 2024, with $79.2 million leaving the market on Monday, according to to data from SoSoValue.
Ethereum ETFs continue to underperform
Despite the long-awaited and strong start for Ethereum ETFs in July 2024, the latest crypto-based ETFs have so far failed to capture institutional interest. The latest data from crypto ETF tracker SoSoValue shows that ETH ETFs witnessed daily total net outflows of $79.2 million on September 23.
A closer look reveals that most of the outflows came from Grayscale’s Ethereum Trust (ETHE), which saw $80.6 million exit the fund, bringing cumulative net total outflows to $2.85 billion. In contrast, Bitwise’s ETHW recorded net inflows of $1.3 million, bringing its cumulative net total inflows to $320.3 million.
It is worth noting that the latest exodus of funds from Ethereum ETFs is the fourth largest in terms of value since their inception on July 23, 2024. The total net assets (TNA) of Ethereum ETFs is $7.2 billion, up from $57.9 billion for Bitcoin (BTC) ETFs.
The continued underperformance of Ethereum ETFs relative to Bitcoin ETFs does not inspire much confidence in ETH’s future price potential. The ETH/BTC trading pair offers clarity as the ratio is currently trading at levels it last saw in April 2021. ETH has erased all the gains against BTC it has made over the past three years.
ETH’s recent underperformance against BTC is not surprising, as the latter posted a new all-time high (ATH) value of $73,737 in March 2024, while the former has yet to break its November 2021 ATH of $4,878.
Challenges may lie ahead for ETH ETFs as speculation grows about the possible launch of ETFs for competing cryptocurrencies, such as Ripple’s XRP. Grayscale recently unveiled the first XRP fund in the US, paving the way for a future potential XRP ETF.
Analysts are confident in Ethereum’s comeback
Ethereum’s challenges have not dampened the optimism that several digital asset analysts shared regarding the second-largest cryptocurrency by market capitalization. Close to the launch of Ethereum ETFs, research firm ASXN predicted that the funds could attract monthly inflows ranging from $800 million to $1.2 billion.
Similarly, Matt Hougan of cryptocurrency exchange Bitwise recently called Ethereum the “Microsoft of blockchains,” signaling confidence in the leading blockchain protocol for smart contracts. Hougan added that ETH could see a trend reversal to the upside in the fourth quarter of 2024. ETH is trading at $2,610 at the time of writing, down 1.7% in the last 24 hours.
Credit : www.newsbtc.com
