Grayscale’s Ethereum Trust (ETHE) Sees Significant Drop in Outflows
Grayscale’s Ethereum Trust (ETHE) witnessed a notable decrease in outflows during its second week of trading, following a massive $1.5 billion outflow in the initial week. Data from Arkham Intelligence revealed that ETHE’s outflows decreased by 80% as it entered its second week.
Reasons Behind the Decline in Ethereum Outflows
On July 29, around 108,800 ETH, valued at $367.6 million, were withdrawn from Coinbase. By August 2, this figure dropped to approximately 24,9000 ETH, equivalent to $78.4 million. Analysts at Coinbase suggest that Ethereum outflows are on a downward trend compared to previous patterns observed with Grayscale Bitcoin Trust (GBTC). While GBTC also faced significant outflows in the past, Ethereum outflows surpassed those of GBTC.
According to Coinbase analysts: “While GBTC shares are frozen due to structural factors and cannot be sold until later in the cycle, there is no such obstacle for Ethereum.”
Exploring Investment Opportunities in Ethereum ETFs
Data from Farside indicates that total outflows from ETHE have surpassed $2 billion since the launch of the Ethereum spot ETF. Consequently, assets under management plummeted from approximately $9 billion to $5.97 billion. Conversely, the smaller mini-Ethereum Trust (ETH) boasts over $1 billion in assets under management, with net inflows of around $210 million since its inception.
The Impressive Performance of Non-Grayscale Ethereum ETFs
Excluding Grayscale, the new spot Ethereum ETFs have shown remarkable performance. CEO of ETF Store, Nate Geraci, highlighted that these ETFs attracted over $1.5 billion within just two weeks, ranking among the top five ETFs launched this year.
Evaluating Ethereum’s Price Trends and ETF Impact
Despite the inflow of funds, Ethereum’s price has experienced a decline of over 10% in the past week, dropping below $3,000. Geraci emphasized that ETFs serve as a gateway to the market but do not directly influence performance.
“ETFs represent only a small portion of the overall market. There are many other factors driving price movements. ETFs provide access but do not control the market,” he asserted.
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