The launch of spot Ethereum ETFs last week was accompanied by strong speculative activity in the digital asset market.
As highlighted by the provider CoinShares, during the week leading up to the launch of these investment instruments, inflows for the digital products sector reached 2.2 billion dollars.
In a scenario like this, the spot ether ETFs still mark significant outflows advanced by Grayscale’s sales.
Let’s see everything in detail below.
Digital asset market growing in the first week of trading of spot Ethereum ETFs
The inauguration week of the spot Ethereum ETFs saw relatively quiet inflows into the market of digital assets, with only 245 million dollars coming in.
This data, however, masks a thriving speculative activity, which has accompanied with high trading volumes a significant moment for the entire cryptographic industry.
In particular, the entry of spot Ethereum ETFs on Wall Street has contributed to bringing the weekly volumes of digital resources to 14.8 billion dollars, the highest level since May.
The total value of assets under management has risen to 99.1 billion dollars while the total inflows year-to-date (YTD) have set a record of 20.5 billion.
Very interesting to note how in the week leading up to the launch of the ether exchange-traded funds, inflows into the CoinShares market rose to the highest level since December 2022.
In fact, according to the latest report from the cryptographic ETP provider, the ETFs have accumulated a significant inflow of 2.2 billion dollars. In the previous week, however, such inflows reached a level of 1.35 billion dollars.
To this is added a 542% increase in products related to the cryptocurrency ETH, highlighting a strong institutional interest.
With this, we are at 4 consecutive weeks of inflows for the digital asset market: such performance suggests that investors are bullish on the short-term future of the crypto market.
Strong outflows in Ethereum ETFs following Grayscale sales
As the inflows in the digital asset market rise, the spot Ethereum ETFs are driven by Grayscale’s outflows.
In the first 4 days of trading for the new regulated investment instrument, Grayscale has indeed totaled a whopping 1.5 billion dollars in outflows.
This is a significant figure because overall, counting all the inflows of the other ETFs, the market shows a negative netflow of 341.8 million dollars.
It is worth noting, however, that the asset management company linked to the group “Digital Currency Group”, at this rate will soon run out of its ETH reserves.
Of the 9.2 billion dollars in initial seed, now only 7.11 billion remain after just 4 days. In such a context, the new spot ETF “Grayscale Mini TRUST” also plays a crucial role, which with a significantly lower fee compared to the twin fund, explains where much of the outflows are headed.
Many investors who before the approval of the ETFs invested in ether through the main Grayscale Trust, are now moving where the fees are lower.
Removed the two Grayscale funds, the other competitors BlackRock, Fidelity, Bitwise, 21Shares, VanEck, Franklin Templeton have recorded 4 consecutive days of positive inflows.
Among these the best was BlackRock which attracted 442 million dollars of capital inflows, followed by Bitwise with 265.9 million.
The trading volumes are around 4 billion dollars overall, while the Net Asset Value amounts to 9.2 billion dollars.
The price of Ethereum stands at 3,375 dollars, up 3.45% compared to the last 24 hours of trading.
Market Outlook of Bitcoin Exchange-Traded Funds
The debut of spot Ethereum ETFs can only have had positive implications also in the Bitcoin ETF market, which continue to show excellent results.
In the week that introduced ether into regulated exchanges, the inflows on Bitcoin reached 535 million dollars.
This is the fourth consecutive week in which investments have favored demand, with the month of July seeing 3.063 billion in inflows.
Also in July, volumes nearly reached 33 billion dollars, with speculations increasing after the projections of the US election campaigns.
Probably, in fact, after the speech by Trump in Nashville in which it emerged that BTC could become a reserve asset in the USA, investors have renewed their optimism.
Weighing positively on the balance are also the increased chances of a FED rate cut in September 2024, which would push risk-on assets upwards.
According to the data from SoSoValue, the spot Bitcoin ETFs currently have a Total Net Assets of 62.1 billion dollars, 6.8 times greater than Ethereum.
Observing more closely the inflows of bitcoin ETFs, we note a total of 17.589 billion dollars entered these markets since their approval in January.
BlackRock reigns supreme in the ranking of the best providers, with its fund having garnered 19.727 billion in positive flows.
Grayscale contrasts this figure with an overall outflow of 18.814 billion, while other issuers record positive numbers.
Stand out in particular Fidelity, Bitwise, and Ark Invest with the positive performances of their investment funds.
