The eight recently launched spot Ethereum (ETH) exchange-traded funds (ETFs) posted nearly $600 million in volume during the first half of their first day, according to data from Bloomberg. Grayscale’s Ethereum Trust (ETHE) led the race with $250 million in traded shares by 12:30 pm ET, followed by BlackRock’s iShares Ethereum Trust (ETHA) with approximately $130 million. Fidelity’s Advantage Ether ETF recorded roughly $77 million in volume, while Bitwise’s Ethereum ETF saw $66 million.
- Grayscale’s ETHE saw $250 million in traded shares.BlackRock’s ETHA recorded $130 million.Fidelity’s Advantage Ether ETF posted $77 million.Bitwise’s Ethereum ETF saw $66 million in volume. “We assume $ETHE volume is mostly outflows,” wrote Eric Balchunas, Bloomberg Intelligence senior ETF analyst, on X. Grayscale’s ETHE, much like its Bitcoin Trust (GBTC), entered the market with over $9 billion in assets, suggesting much of its volume might be outflows.On the lower end of the volume spectrum, Invesco and 21Shares’ ether ETFs had not yet hit the $10 million mark after four hours of trading. If this pace continues, the newly launched ETFs are projected to reach about $940 million on their first day, according to Bloomberg Intelligence ETF analyst James Seyffart. This would be just over 20% of the volume seen by spot bitcoin ETFs on their first day.
- Invesco and 21Shares’ ether ETFs had less than $10 million in volume.New ETFs could reach roughly $940 million in volume on the first day. Analysts predict demand for ether ETFs will be at most 20% of that for bitcoin ETFs due to reasons like lack of name recognition and the inability to stake the cryptocurrency when buying shares of the funds. Additionally, ether’s low funding rate could be a factor. Markus Thielen, founder of 10x Research, noted that bitcoin’s funding rate was near 15% when ETFs launched in January, increasing to 70% in February, which attracted institutional arbitrage funds. Ethereum’s current funding rate, however, is significantly lower at 7% to 9%, which may be too low for institutions to consider using the funds for arbitrage investment, especially with interest rates at 5%.
- Analysts expect ether ETF demand to be 20% of bitcoin ETFs.Ethereum’s current funding rate is 7% to 9%, compared to bitcoin’s higher rates. “Contrary to the strong Bitcoin Spot ETF flows in February, Ether ETF flows will likely not attract those arbitrage flows instrumental in driving positive sentiment,” Thielen noted.
