The spot Ethereum ETFs finally made their debut a few months after receiving approval from the SEC. However, the initial performance has been lackluster compared to the launch of spot Bitcoin ETFs earlier in the year. While the Ethereum ETFs managed to attract over $106 million in net flows on the first day, it was overshadowed by significant withdrawals from the Grayscale fund (ETHE) amounting to nearly $500 million. The subsequent days painted a bleak picture with daily outflows growing steadily, reaching $162.7 million by the fourth day of trading. This downward trend is a cause for concern, especially considering the increasing outflows from Grayscale’s ETHE.
When comparing the performance of spot Ethereum ETFs to spot Bitcoin ETFs in their first four days of trading, the difference in investor interest becomes apparent. While Bitcoin ETFs saw inflows of over $650 million on the launch day, Ethereum ETFs only managed to attract $106 million. The disparity continued in the following days, with Bitcoin ETFs consistently drawing in substantial amounts while Ethereum ETFs struggled to maintain positive inflows. The total outflows from spot Ethereum ETFs reached $341.8 million by the fourth day, highlighting the challenges faced by these products in generating investor interest.
Despite the significant disparities in investor interest between spot Ethereum ETFs and spot Bitcoin ETFs, the price performances of the underlying assets after the ETF launches tell a different story. Following the launch of Bitcoin ETFs, the cryptocurrency initially surged from $45,000 to $49,000 but experienced a downturn to $41,300 by the fourth day. On the other hand, Ethereum started with a price dip from $3,500 to $3,000, which was somewhat expected given the outflows, but managed to rebound and stabilize around $3,300. This resulted in Ethereum only experiencing a 6.5% decline, while Bitcoin plummeted by 16% despite the success of its ETFs in the early days.
The contrasting performances of spot Ethereum ETFs and spot Bitcoin ETFs in their early days raise questions about the long-term viability and demand for these products. The challenges faced by Ethereum ETFs in attracting inflows and retaining investor interest compared to Bitcoin ETFs point to potential issues with market sentiment and perception. Despite the price stability of Ethereum following the launch of its ETFs, the lack of substantial inflows remains a concern for the future growth and adoption of these products. Observing how these trends develop over time will be crucial in understanding the evolving dynamics of the cryptocurrency market and investor behavior towards ETFs.
