Daily net spot Ethereum ETF (exchange-traded fund) inflows in the US have flipped positive once again, despite significant cumulative outflows from the Grayscale Ethereum Trust (ETHE).
On August 1, the Ether (ETH) ETFs recorded a net inflow of $26.7 million, marking a notable shift in investor sentiment.
A Shift in Ethereum ETF Inflows
The positive net inflow was led by a substantial $89.6 million inflow into BlackRock’s iShares Ethereum Trust (ETHA), according to data from Farside Investors. This influx into ETHA demonstrates growing investor confidence in Ethereum ETFs, despite the challenges faced by the Grayscale Ethereum Trust.
Grayscale’s Ethereum Trust, which was recently converted into a spot ETF, saw outflows of $78 million on August 1. These outflows have brought the cumulative outflows from the fund to just over $2 billion since its conversion. The outflows represent a significant 22% of the initial $9 billion in Ether that the fund held prior to its conversion.
The conversion of Grayscale’s Ethereum Trust into a spot ETF has been a critical development in the cryptocurrency investment landscape. Unlike the eight other spot Ether ETFs launched as new funds on July 23, ETHE was an established trust offering institutional investors exposure to Ether. The conversion aimed to provide a more liquid and accessible investment vehicle for institutional and retail investors alike.
However, the conversion also triggered substantial outflows as investors re-evaluated their positions in the newly converted ETF. This has been a point of concern for market observers and investors.
Steno Research senior analyst Mads Eberhardt has provided insights into the current situation, suggesting that the massive outflows from Grayscale’s ETHE are likely to subside by the end of the week. Eberhardt views the slowing of these outflows as a bullish catalyst for the price of ETH. In a July 30 post on X, Eberhardt expressed optimism, stating, “When it does, it’s up only from there.”
Earlier, on July 23, Kaiko’s head of indexes, Will Cai, highlighted the sensitivity of ETH’s price to inflows into spot products. This sensitivity has been reflected in the recent price movements of ETH, which is currently trading at $3,168. The price has seen a decline of 8.5% since the launch of the ETFs, according to TradingView data.
The Broader Impact on Ethereum ETFs
The positive net inflows into Ether #ETFs on August 1 are a significant development, indicating renewed investor interest and confidence in Ethereum-based investment products. This trend is particularly noteworthy given the backdrop of substantial outflows from Grayscale’s Ethereum Trust.
The inflows into BlackRock’s iShares #Ethereum Trust (ETHA) are particularly significant, as they represent a major vote of confidence from investors. BlackRock’s entry into the Ethereum ETF market has brought additional credibility and visibility to these investment products.
$ETH #ETH
