Ethereum exchange-traded products faced a rocky end to June, recording their largest outflow since August 2022. CoinShares’ weekly analysis reported that investors withdrew a staggering $61 million from Ether investment products between June 24-29. This brings the total outflows for the past two weeks to $119 million, with June’s total balance reflecting a $37 million withdrawal. These figures mark Ether funds as the worst-performing asset year-to-date in terms of net flows, with a total of $25 million withdrawn so far.
Despite the United States Securities and Exchange Commission (SEC) approving Ether exchange-traded funds (ETFs) in May, the cryptocurrency experienced a price decline of over 8.7% in June. Analysts expect the eight approved funds to debut in the coming weeks, with Bloomberg ETF analysts Eric Balchunas and James Seyffart noting that the SEC has recently requested prospective issuers to resubmit their S-1 forms by July 8. This pushes the ETFs’ launch to mid-July or later. Bitwise has predicted that these funds could attract $25 billion by the end of 2025.
The significant outflows from Ether have impacted the overall performance of digital asset investment products, totaling $30 million in outflows over the past week. However, in a contrasting trend, most Bitcoin ETF providers saw modest inflows. CoinShares reported that Grayscale’s Bitcoin fund experienced outflows of $153 million, which offset an overall inflow of $10 million among other issuers. Multi-asset and Bitcoin ETPs led the inflows with $18 million and $10 million, respectively. The report also highlighted a rise in outflows for short-bitcoin, totalling $4.2 million last week, suggesting a potential shift in market sentiment.
Trading volumes saw a notable increase, rising 43% week-on-week to $6.2 billion as of June 29, though this remains below the $14.2 billion weekly average for the year so far, according to CoinShares. Among altcoins, Solana funds saw inflows of $1.6 million, while Litecoin attracted $1.4 million over the same period.
The broader trend for blockchain equities has also been bearish, with $545 million withdrawn this year, representing 19% of market capitalization. This ongoing trend reflects the cautious approach investors are adopting amid a volatile market environment.
Ether’s outflows and the cryptocurrency’s price dip come despite the optimism surrounding the SEC’s approval of Ether ETFs. The anticipated launch of these funds in mid-July or later could potentially shift market dynamics, but for now, Ether remains under pressure. Investors are closely watching how these developments unfold, particularly as they weigh the potential benefits of newly launched ETFs against the backdrop of recent outflows and price declines.
The cryptocurrency market continues to be a rollercoaster, with fluctuating sentiments and significant movements in both inflows and outflows across various digital assets. Ether’s recent performance underscores the unpredictable nature of the market and the challenges faced by investors navigating this space.
