Ethereum ETFs Show Comparable Trend to Bitcoin ETFs, Noted Market Analyst Finds

Spot Ethereum Exchange-Traded Funds (ETFs) are currently facing a negative sentiment, reflecting a similar trend seen with Spot Bitcoin ETFs since their launch earlier this year. Both cryptocurrencies are experiencing decreased inflows and declining performance, indicating a shared downward pressure.

According to analysts at the Woo X research platform, spot Ethereum ETFs are following a downward trajectory similar to Bitcoin, showcasing the overall bearish market sentiment. Following the introduction of ETH spot ETFs on July 23, the crypto asset witnessed an 11% price drop, plummeting from $3,500 to approximately $3,100 within just three days.

In addition to the challenging market conditions, analysts highlight that ETH spot ETFs are encountering a hurdle comparable to what BTC previously faced, citing the selling pressure exerted by major asset management company, Grayscale.

After the launch of Bitcoin spot ETFs, BTC experienced a 20% price decline, dropping from around $48,000 to $38,000 over a two-week period due to selling pressure from Grayscale’s BTC ETF, GBTC. However, the price later surged to a record high of $73,000 as Grayscale’s selling pressure eased, and capital inflows into the funds continued to rise.

Should Ethereum undergo a similar scenario, Woo X predicts that ETH’s price could reach $2,850, with the impact dependent on Grayscale’s selling pressure and the overall net inflows into spot ETH ETFs.

Investor interest in spot Ethereum ETFs appears to have waned, with a negative outflow observed in the funds after Tuesday’s trading session, resulting in millions of dollars exiting the products.

Data from London-based investment management company Farside Investors reveals an overall outflow of $47 million from the products. While Fidelity ETH ETF (FETH) attracted approximately $4.9 million in daily inflows, other funds like Blackrock’s Ethereum ETF (ETHA), Bitwise ETH ETF (ETHW), 21Shares ETH ETF (CETH), VanEck ETH ETF (ETHV), and Franklin ETH ETF (EZET) closed with zero inflows. Grayscale ETH ETF (ETHE) experienced outflows reaching about $52.3 million.

The outflow signals investors withdrawing from the products due to recent ETH price movements and market fluctuations, reflecting a cautious approach as they reassess their exposure to the altcoin.