The recent introduction of spot Ethereum ETFs in the United States has caused a significant increase in trading volumes, reaching $14.8 billion, the highest since May. This surge in trading activity is attributed to the $2.2 billion inflow into these newly launched funds last week, marking one of the highest inflows since December 2020.
Despite the impressive increase in trading volume, the Ethereum ETPs have also experienced a 542% surge in trading volume. However, these inflows have been somewhat offset by Grayscale’s existing $1.5 billion Ethereum trust, resulting in a net outflow of $285 million for the week. This trend is similar to what was observed with Bitcoin trust outflows during the ETF launches in January 2024.
The latest edition of the “Digital Asset Fund Flows Weekly Report” highlights how Ethereum ETF launches have been driving market activity, with total inflows amounting to $245 million. The recent price surge has also pushed total assets under management (AuM) to $99.1 billion, with year-to-date inflows reaching $20.5 billion.
Bitcoin has also seen strong inflows of $519 million in the past week, bringing its month-to-date inflows to $3.6 billion and year-to-date inflows to a record $19 billion. This renewed investor confidence is attributed to US electioneering remarks about Bitcoin potentially becoming a strategic reserve asset and the increased likelihood of a FED rate cut in September 2024.
While Bitcoin has been attracting significant inflows, short-Bitcoin investment products saw only modest inflows of $0.3 million. This indicates that while some investors are hedging their bets against potential market downturns, the overall sentiment towards Bitcoin remains bullish.
In terms of altcoins, Cardano, Litecoin, XRP, and Chainlink have all seen varying degrees of weekly inflows. Cardano received $1.2 million, Litecoin $0.6 million, XRP $0.5 million, and Chainlink $0.3 million. However, Solana experienced outflows of $2.7 million for the week.
Regionally, the US led in inflows with $272 million, followed by Switzerland with $40.6 million. Canada and Australia also saw mild inflows of $2.5 million and $1.7 million, respectively. On the other hand, Germany recorded the highest outflows with $59.6 million, followed by Brazil, Hong Kong, and Sweden with $5.6 million, $3.5 million, and $2.6 million in weekly outflows.
Overall, the introduction of Ethereum ETFs in the US has had a significant impact on trading volumes and market activity, attracting substantial inflows and driving investor confidence in digital assets. This trend is likely to continue as more investors seek exposure to cryptocurrencies through regulated investment products.