Last week, the Ethereum spot ETF launched in the United States triggered a massive inflow of funds. This emerging financial product quickly caused huge waves in the entire cryptocurrency market and quickly became the focus of the cryptocurrency market.
CoinShares' latest report reveals that with the launch of the Ethereum spot ETF, the market has witnessed an influx of $2.2 billion in funds, which not only represents a turning point in the Ethereum market, but also indicates investors' strong interest in this crypto asset.
Ethereum ETFs Surge, How Is Bitcoin Performing?
The latest data from Coinshares shows that not only has the launch of the Ethereum ETF brought massive inflows, but the size of Ethereum exchange-traded products (ETPs) has also increased by a staggering 542%. This surge in capital shows that investors' interest in investing in Ethereum through regulated financial products is growing rapidly.
However, Coinshares head of research James Butterfill noted that this growth figure is actually “somewhat controversial.” He explained that Grayscale used its approximately $1 billion of existing closed-end trust capital to inject funds into its new mini-trust ETFs, which may be a reason for the steady outflows in recent years.
Despite the controversy, the launch of an ETF is still a major milestone for the cryptocurrency market as it fits in with the broader market trend of investors seeking diversified and secure investment avenues.
However, the overall situation in the digital asset market is not entirely optimistic. For example, Grayscale's Ethereum Trust Fund saw a net outflow of $285 million, showing that the market's attitude towards certain products has become divided.
Meanwhile, Bitcoin has retained its appeal, with $3.6 billion in inflows over the past month, trailing closely behind Ethereum. Total inflows so far this year have reached a record $19 billion, helped by speculation over the U.S. election and expectations of potential changes in Federal Reserve policy.
Butterfill specifically pointed out that discussions around Bitcoin as a potential strategic reserve asset and the increased likelihood of a Federal Reserve rate cut in September 2024 may be reasons for the increased investor confidence.
In addition, the Coinshares report also provides an in-depth analysis of the consequences of capital flows, emphasizing that the total inflow of all digital assets reached a record high of $20.5 billion in 2024. The surge in trading volume has promoted the launch of Ethereum spot ETFs in the United States and may indicate the market's continued interest in such products.
Market performance analysis of BTC and ETH
Although the spot ETF products of Bitcoin and Ethereum have attracted a lot of capital inflows, their price performance in the market has not kept pace with it. After the launch of the spot ETF, the market saw a typical "sell the news" phenomenon, causing its price to fall to a low of $3,098 in a short period of time. Although it has since rebounded and is currently trading at more than $3,300, compared with the market's enthusiastic response to the launch of the ETF, the spot ETF products of Ethereum have not yet shown the expected strong performance. $ETH
Meanwhile, Bitcoin also experienced a brief price drop following the launch of the Ethereum ETF, briefly hitting a low of $64,000. However, Bitcoin soon showed its resilience, with the price quickly recovering and rising. Currently, Bitcoin is trading at $66,585, a correction from the high of $70,079 on the 29th. Of particular interest is the fact that Bitcoin’s current bullish trend is partly due to former President Donald Trump’s positive remarks at the Bitcoin Conference 2024, which may have had a significant positive impact on market sentiment. $BTC
Overall, although the ETF products of the two major cryptocurrencies are popular with funds, the actual performance of their market prices is complex and changeable, showing that the market's initial response to these financial innovation products is cautious and selective. When evaluating these products, investors need to comprehensively consider the impact of market sentiment, price trends, and external factors.
Conclusion:
Although the Ethereum spot ETF launched in the United States has attracted a large amount of capital inflow, its market price performance has not kept pace with it, indicating that the market's initial response to this financial innovation product is cautious. At the same time, although Bitcoin has also experienced price fluctuations, its status as a potential strategic reserve asset has been recognized by the market, and the amount of capital inflow has continued to grow.
Although the market's reaction to these products is mixed, they provide investors with new investment channels, indicating that the market's interest in such products will continue. As investors become more comfortable with these tools, the cryptocurrency market is expected to usher in a more mature and stable development.
