Recent Investor Sentiment in Ethereum ETFs
The market for spot Ethereum exchange-traded funds (ETFs) in the United States has experienced a notable shift in investor sentiment, characterized by the largest influx of capital since early August. This increase in inflows marks a significant turning point, ending a six-week period of continuous outflows that had dampened optimism among investors.
Data from SoSoValue reveals that on a single day, Friday, US-based spot Ethereum ETFs welcomed inflows totaling $58.7 million. This surge contributed to a net positive inflow of $84.5 million for the entire week, effectively breaking the streak of consecutive outflows and signaling renewed interest in these funds.
Fidelity’s FETH Fund Dominates Inflows
Leading the way in terms of inflows was Fidelity’s FETH fund, which recorded an impressive one-day influx of $42.5 million. Close behind was BlackRock’s ETHA fund, attracting $11.5 million in the same timeframe. While Fidelity’s fund achieved the highest single-day inflow, it is worth noting that BlackRock’s ETHA fund reached a significant milestone shortly after its debut.
In just two months since its launch, BlackRock’s ETHA surpassed a remarkable $1 billion in total net asset value, becoming only the second Ethereum ETF to reach this benchmark, following Grayscale’s Ethereum Mini Trust. This milestone positions BlackRock’s fund among the top 20% of over 3,700 ETFs available on the US market, highlighting its rapid success, as noted by Nate Geraci, the president of The ETF Store.
Additional Fund Performance and Market Activity
Several other funds also made positive gains, reflecting the overall recovery in investor confidence. Bitwise’s ETHW gained $5.4 million, Invesco’s QETH attracted $4.3 million, Grayscale’s ETH added $2.3 million, VanEck’s ETHV took in $2.0 million, and 21Shares’ CETH saw $1.4 million in inflows. However, not all funds shared the same fortune; Grayscale’s ETHE faced outflows amounting to $10.7 million, and Franklin’s EZET remained stagnant with no changes in its inflows or outflows.
Overall, positive inflow activity occurred on three out of the five trading days last week. This marks only the second week of positive inflows since the launch of these Ethereum ETFs in late July. As a result of this activity, the cumulative net asset value of all Ethereum ETFs has reached $7.4 billion, the highest recorded level since August 26.
The recent decision by the Federal Reserve to cut interest rates appears to have bolstered market confidence. Interestingly, Ethereum’s price has outperformed Bitcoin during this period, and transaction fees have surged due to increased activity on the blockchain, demonstrating a growing interest in Ethereum as the second-largest cryptocurrency by market capitalization.
SEC Delays Decision on Ethereum ETF Options
The U.S. Securities and Exchange Commission (SEC) has announced a delay in its decision regarding Nasdaq’s proposed rule change to list and trade options on BlackRock’s iShares Ethereum Trust (ETHA). Initially expected by September 26, the new deadline for the SEC’s decision has been postponed to November 10.
The regulatory agency indicated that the extension is necessary to thoroughly assess the implications of such a move on market stability. This delay is not uncommon; under Section 19(b)(2) of the Securities Exchange Act, the SEC is empowered to extend its review period by up to 90 days to evaluate potential risks and benefits comprehensively.
This decision comes on the heels of the SEC’s approval for options trading on BlackRock’s iShares Bitcoin Trust (IBIT), which occurred after amendments were made to address concerns regarding market manipulation and excessive risk-taking. In addition to the postponement for BlackRock’s Ethereum options, the SEC is also reviewing another proposal from NYSE American LLC concerning similar matters.