Ethereum ETFs: Mixed Start, Grayscale’s ETHE Faces Outflows
Ethereum exchange-traded funds (ETFs) launched in the US this week have seen a mixed reception. While most new ETFs saw inflows, Grayscale’s converted fund, ETHE, experienced significant outflows.
First Week of Trading
- Total inflows for new Ethereum ETFs: $106.7 million on the first day, $162 million in outflows on July 26.
- BlackRock’s ETHA led the pack in terms of inflows, with $442 million.
- Grayscale’s ETHE saw $1.51 billion in net outflows during the first week.
Grayscale’s Ethereum ETFs
Grayscale launched two spot Ethereum funds: ETHE and ETH.
- ETHE, converted from a private placement, has a 2.5% management fee.
- The higher fee compared to other ETFs has driven investors to switch to competing products, leading to significant outflows.
- Grayscale’s ETH fund, with a 0.15% fee, saw inflows every trading day this week.
Comparison to Bitcoin ETFs
While the first week for Ethereum ETFs saw a mixed performance, it is still early days.
- GBTC, Grayscale’s Bitcoin Trust, also saw outflows after its conversion to a BTC ETF, but the discount to spot BTC price played a role.
- ETHE’s “discount” had closed before the launch, potentially contributing to the stronger incentive to exit.
Future Prospects
Analysts predict that spot Ethereum ETFs will attract inflows between 6% and 48% of those seen by Bitcoin ETFs in the first six months.
- Total inflows into Ethereum ETFs could reach between $1 trillion and $7.5 trillion by late January 2025.
It remains to be seen how the Ethereum ETF market will develop in the coming months. The performance of Grayscale’s ETHE, in particular, will be closely watched.
**Links:**
* Ethereum: [https://ethereum.org/](https://ethereum.org/)
* Grayscale: [https://grayscale.com/](https://grayscale.com/)
* BlackRock: [https://www.blackrock.com/](https://www.blackrock.com/)
* Bitwise: [https://bitwiseinvestments.com/](https://bitwiseinvestments.com/)
* Fidelity: [https://www.fidelity.com/](https://www.fidelity.com/)
* VanEck: [https://www.vaneck.com/](https://www.vaneck.com/)
* Franklin Templeton: [https://www.franklintempleton.com/](https://www.franklintempleton.com/)
* 21Shares: [https://21shares.com/](https://21shares.com/)
