Ethereum ETF Spot Trading Volume Plummets

Bittime - Spot Ethereum ETFs attracted a lot of attention in the early days of their launch, but recently, demand has started to cool. After peaking at the start of the week, Ethereum ETFs trading volume has now experienced a significant decline.

Trading Volume Decreases

On Thursday, cumulative trading volume among Ethereum ETF funds reached about $850 million, according to data from Yahoo Finance compiled by The Block Pro Research. This was down from $1.05 billion in Tuesday's session and more than $950 million on Wednesday.

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Outflows and Declining Prices

ETF funds recorded net outflows of $133.16 million on Wednesday, a reversal from net inflows of $106.78 million on Tuesday. Grayscale Ethereum Trust (ETHE) saw net outflows of $326.86 million, becoming the only ether fund to record outflows, according to SosoValue.

Ahead of Thursday's trading session, ether prices fell more than 7% overnight. "This sharp decline is not only not surprising but is expected," Keyrock's Justin d'Anethan told The Block on Thursday. “Market memory is short, but while spot bitcoin ETFs pushed prices up early, crypto markets fell.”

Ether Price and Investment Strategy

At the time of publication, ether was still down nearly 8% to $3,102, according to The Block's ETH price page. In the last 24 hours, trading volume reached $25.9 billion.

“After the launch of the ETP, BTC prices were initially depressed due to a combination of ‘sell the news’ and large outflows from GBTC,” said Juan Leon, Bitwise Investment Strategist, in a post on ."

Leon noted that after two days of trading, ETH was down nearly 10%. Similar to the case of BTC, there has been a large outflow from the Grayscale Ethereum Trust (ETHE) that may continue for some time and the price of ether has risen in the two weeks prior to the launch of the spot ETF.

Growing Institutional Demand

"Will this happen to ETH? It can't be known for sure, but institutional demand for crypto assets is increasing, and ETH has now joined BTC as the only two crypto assets that have an ETP wrapper," said Leon.

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Conclusion

The decline in trading volume and price of Ethereum ETFs Spot indicates that the market is still in an adjustment phase after a strong initial launch. While institutional demand for crypto assets continues to grow, current market dynamics reflect near-term trends that investors should be aware of. Whether this will be a sustainable pattern or just a temporary dip, only time will tell.

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