Title: Spot Ethereum ETFs Experience $14 Million Outflows Despite Ether Price Increase
Investing.com – In a recent report by Barclays analysts, it was revealed that spot exchange-traded funds (ETFs) in the United States saw $14 million leaving regulated products over the past week. This surprising liquidation occurred even as the price of ether, the cryptocurrency that spot Ethereum funds follow, rose by 2.19% during the same period.
The main reason for the outflows was attributed to withdrawals from Grayscale’s Ethereum Trust, which witnessed $118 million exiting the fund. However, there was a slight offset with a $2 million inflow into Grayscale’s Ethereum Mini Trust, the second-largest spot ether ETF by net assets.
Interestingly, the VanEck Ethereum ETF recorded $8 million in net outflows, contributing to the overall negative trend. On the other hand, Blackrock’s iShares Ethereum Trust ETF saw the strongest inflows with $76 million, followed by Fidelity Ethereum Fund with $26 million.
Analysts also pointed out the implications for Coinbase, which serves as the custodian and prime broker for six of the ETFs and eight spot ETFs. They mentioned that while Coinbase could benefit from growth in assets under management (AUM) and redemption/creation activity, the company might also face increased competition for trading volumes.
Barclays highlighted that trading volumes across ETF products, although relatively small compared to on-exchange crypto volumes, consistently represented about 2% of spot crypto trading volumes over the past week. Additionally, they announced that this would be their last weekly publication tracking Ethereum ETF flows, as they are shifting focus to their monthly crypto report, which will now include Bitcoin ETF flows.
Overall, the recent outflows from spot Ethereum ETFs amidst the price increase of ether indicate a complex market dynamic. Investors should closely monitor these trends to make informed decisions about their investments in the cryptocurrency space.