The much-anticipated launch of Ethereum ETFs in the U.S. saw a promising start, attracting a combined net inflow of nearly $107 million on their first day.
What Happened: The launch saw a flurry of activity with over $1 billion in shares traded across nine newly introduced ETFs.
BlackRock Inc.'s iShares Ethereum Trust ETHA led the pack with the highest level of inflows on Tuesday, securing $266.55 million.
Following closely were Bitwise Ethereum ETHW with $204 million and the Fidelity Ethereum Fund FETH with $71 million, according to data from SoSo Value.
This launch comes six months after U.S. regulators greenlighted the first U.S. spot-Bitcoin ETFs, which have collectively drawn in over $17 billion in net inflows this year.
What Experts Say: Lennix Lai, Global Chief Commercial Officer at OKX told Benzinga that the approval and launch of ETH ETFs shows that the SEC doesn't define ETH as a security and that has a significant implication to the classification of proof-of-stake (PoS) tokens in the market.
This could have cleared many regulatory roadblocks, uncertainty and risks for businesses working with PoS tokens, and even paved the way for the ETFs of other PoS tokens, he added.
“In terms of price, there could be a short-term price increase for ETH – given a substantial portion of ETH is staked in the protocol which could lead to scarcity – but the macro-economic factors are probably more influential than the launch of ETH ETFs,” he said.
Ethereum ETH/USD, the second-largest digital asset, is highly regarded for blockchain-based financial services.
However, its market value remains less than a third of Bitcoin's BTC/USD, leading to expectations of smaller inflows compared to Bitcoin ETFs.
The Bitcoin funds benefited from a narrative that positions the leading cryptocurrency as digital gold, a branding advantage that Ethereum lacks.
Also Read: Ethereum May Be Headed For A Sell-Off After ETFs Launched: 10x Research
Additionally, the new Ether ETFs do not offer staking rewards, a benefit accessible through direct ownership of the token.
The US Securities and Exchange Commission (SEC) gave final approval to the spot Ethereum ETFs on July 22, and trading commenced in the United States on July 23.
What Bitcoin Did: On the same day, Bitcoin spot ETFs experienced a total net outflow of $77.97 million, marking the first net outflow after 12 consecutive days of net inflows.
Grayscale‘s GBTC saw a net outflow of $27.31 million, while Ark & 21Shares‘s ETF ARKA had an outflow of $52.29 million and Bitwise‘s Bitcoin ETF BITB recorded an outflow of $70.32 million.
In contrast, BlackRock’s IBIT had a net inflow of $71.94 million.
As the digital asset landscape continues to evolve, the successful launch of Ether ETFs underscores growing investor interest in cryptocurrencies beyond Bitcoin.
What’s Next: For more insights into the future of digital assets, join industry leaders at Benzinga’s Future of Digital Assets event on Nov. 19.
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