Ethereum ETFs See Major Outflows Amid Global $146 Million Net Outflows in Ethereum Investments

• Ethereum investment products saw global net outflows of $146 million over the past week, primarily due to significant withdrawals from US spot Ethereum ETFs.
• These withdrawals were driven by $603 million outflows from Grayscale’s ETHE fund, despite new Ethereum ETFs attracting $430 million in net inflows.
• A CoinShares’ report also noted modest outflows in European ETPs and highlighted broader market trends impacting digital assets.

Discover how Ethereum and other crypto assets faced substantial outflows last week and understand the broader market implications.

Ethereum ETF Outflows Lead the Week

Last week, Ethereum investment products experienced a total of $146 million in net outflows globally, a trend significantly driven by the US market. The US spot Ethereum ETFs accounted for $169.4 million in outflows, a figure that overshadowed the $430 million net inflows into new Ethereum ETFs. Notably, Grayscale’s ETHE fund faced outsized withdrawals amounting to $603 million, exerting significant downward pressure on Ethereum’s investment products.

Bitcoin and Other Cryptos Also Face Turbulence

Bitcoin wasn’t immune to the trend, experiencing massive outflows totaling $400 million. This marked a notable departure from five weeks of consistent inflows. Interestingly, short-Bitcoin investment products saw their first significant inflows since June, totaling $1.8 million. Solana also faced weekly outflows of $2.8 million, while XRP and Litecoin each recorded modest inflows of $0.4 million and $0.2 million, respectively. The outflows extended beyond cryptocurrencies, impacting blockchain equities which saw outflows of $18 million, perpetuating a broader trend observed across tech-related ETFs.

Market Dynamics and Regional Insights

Digital asset investment products, for the first time in four weeks, experienced net outflows of $528 million. CoinShares attributes this trend to investor concerns over a potential US recession, broader geopolitical challenges, and market-wide sell-offs affecting various asset classes. Over the same period, ETPs recorded trading volumes of $14.8 billion, representing just 25% of the total market and sitting below average levels.

Regionally, the United States accounted for the majority of outflows with $531 million. Hong Kong and Germany followed with $27 million and $12 million in outflows, respectively, while Sweden recorded $6.8 million in outflows. Meanwhile, regions like Switzerland and Canada witnessed inflows, capitalizing on the price corrections. Switzerland saw inflows of $28 million, Canada $17 million, Australia $3.4 million, and Brazil $0.1 million.

Conclusion

In summary, the past week has been marked by significant outflows across major cryptocurrencies and digital asset investment products, with Ethereum and Bitcoin bearing the brunt of the withdrawals. The outflows reflect growing investor concerns about economic and geopolitical stability. As such, the market expects continued volatility, with both downside risks and potential recovery opportunities on the horizon. Staying informed and vigilant will be crucial for investors navigating these turbulent times.