Ethereum ETFs see $14M net outflows amid Grayscale withdrawals

Ethereum

Investing.comAug 19, 2024 12:46 PM

Investing.com – Spot Ethereum exchange-traded funds (ETFs) saw $14 million leaving the regulated products in the United States over the past week, according to Barclays (LON:BARC) analysts in a Monday note.

The liquidation occurred despite ether, the cryptocurrency that spot Ethereum funds follow, rising 2.19% last week.

The outflows were primarily driven by withdrawals from Grayscale's Ethereum Trust (NYSE:ETHE), which saw $118 million exiting the fund. The downturn was slightly mitigated by a $2 million inflow into Grayscale's Ethereum Mini Trust (NYSE:ETH) trust, the second-largest spot ether ETF by net assets.

"Grayscale saw an outsized portion of the outflows from their ethereum trust, though this was offset slightly by inflows into their mini ethereum trust," the note said.

The VanEck Ethereum ETF (NYSE:ETHV) also recorded $8 million in net outflows, adding to the overall negative trend. The Blackrock's iShares Ethereum Trust ETF (NASDAQ:ETHA) saw the strongest inflows, bringing in $76 million, followed by Fidelity Ethereum Fund (NYSE:FETH) with $26 million.

The analysts noted the implications for Coinbase (NASDAQ:COIN), which serves as the custodian and prime broker for six of the ETFs and eight spot Bitcoin ETFs.

"Coinbase could benefit from growth in AUM and redemption/creation activity, though the company could also face heightened competition for trading volumes," the analysts said.

Barclays also observed that while trading volumes across ETF products remain relatively small compared to on-exchange crypto volumes, they consistently represented about 2% of spot crypto trading volumes over the past week.

Barclays said the note would be the last weekly publication tracking Ethereum ETF flows, as they are shifting focus to their crypto monthly report, which includes Bitcoin ETF flows.

The nine spot Ethereum ETFs launched on July 23, marked the second set of funds tied to the current price of a major cryptocurrency. Spot Bitcoin ETFs hit the market earlier on January 11, after nearly a decade of pushback from the Securities and Exchange Commission (SEC) against these kinds of products.

Reviewed byTony

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