Ethereum ETFs: Monochrome, VanEck, and Others Experience Outflows in Evolving Market

Ethereum has experienced significant developments in its ETF landscape this week. One prominent asset management company decided to discontinue one of its Ethereum-based offerings, while another firm applied for a new spot Ethereum ETF. These occurrences unfolded amidst a period where Spot ETH ETFs witnessed minimal inflows, adding to the ambiguous sentiment surrounding ETH.

In Australia, Monochrome Asset Management recently disclosed its intention to list the Monochrome Ethereum ETF (Ticker: IETH) on Cboe Australia. This ETF aims to passively hold ETH, marking it as Australia’s first ETF to do so. This move follows Monochrome’s previous entry into the cryptocurrency ETF sector with its BTC ETF launch in June 2024.

Conversely, VanEck, another significant asset management entity, announced the closure of one of its ETH ETF features. The VanEck Ethereum Strategy ETF (EFUT), a Futures-based Ethereum ETF, will be liquidated due to insufficient demand. Traders have shown a preference for spot ETFs over Futures products, leading to the decision to cease trading EFUT shares on 16 September, with assets being returned to investors by 23 September.

The divergent actions by Monochrome and VanEck underscore the increasing popularity of spot ETFs in the cryptocurrency market. Monochrome’s introduction of the spot Ethereum ETF (IETH) aligns with this trend, while VanEck’s move to wind down its Futures ETF reflects the waning appeal of Futures offerings in favor of direct exposure through spot ETFs.

Despite the evident favoritism towards spot ETFs, the overall trend for these products has been marked by outflows over the past week. Data analysis from SoSoValue reveals that Spot Ethereum ETFs experienced consecutive outflows across various exchanges, totaling approximately $6 million by 6 September and reaching a net outflow of $-91 million for the week. The cumulative netflows for spot ETH ETFs now amount to around $-568.30 million, indicating a persistent pattern of investor withdrawals.

These market conditions have prompted investors to scale back their ETH positions in recent weeks, reflecting a shifting landscape in the Ethereum ETF arena.