Recent developments in the Ethereum ETF space have garnered attention this week. A prominent asset management firm decided to discontinue a key Ethereum-related feature, while another entity filed for a new spot Ethereum ETF. The dynamics surrounding these announcements have influenced the sentiment surrounding Ethereum.
During this period, there was minimal activity in terms of inflows for Spot ETH ETFs, further contributing to the diverse perspectives on ETH.
Introduction of New Ethereum ETF Offering in Australia
Monochrome Asset Management, a company based in Australia, made public its intention to list the Monochrome Ethereum ETF (with ticker symbol IETH) on Cboe Australia. The firm intends to adopt a passive approach in holding ETH, positioning itself as the inaugural ETF in Australia to prioritize such a strategy. This initiative underscores Monochrome’s commitment to broadening its presence in the cryptocurrency ETF sphere, building on the introduction of its BTC ETF in June 2024.
Conversely, VanEck, another significant player in the asset management sector, announced the closure of one of its ETH ETF features.
VanEck’s Decision to Cease Ethereum Futures ETF Operations
VanEck disclosed on 6 September its board’s approval for the liquidation of the VanEck Ethereum Strategy ETF (EFUT) – an Ethereum ETF relying on futures contracts.
The rationale behind the fund’s liquidation was the inadequacy of demand, with traders showcasing a clear preference for spot ETFs over futures-based alternatives. The EFUT shares will halt trading activities on 16 September, with the assets slated for liquidation and subsequent return to investors by around 23 September.
The divergent strategies pursued by Monochrome and VanEck underscore the shifting preferences within the cryptocurrency market towards spot ETFs. The inauguration of Monochrome’s spot Ethereum ETF (IETH) resonates with this evolving trend, whereas VanEck’s move to discontinue its Futures ETF mirrors the waning interest in futures instruments in favor of direct participation through spot ETFs.
Despite the increasing popularity of spot ETFs, recent trends indicate outflows in this product category over the past week.
Consecutive Outflows for Spot ETH ETFs
According to data analysis by SoSoValue, Spot Ethereum ETFs observed a series of outflows across various exchanges in the past week. As of the 6th of September, the cumulative outflows reached nearly $6 million, resulting in total net outflows of $-91 million for the week.
Overall, the net outflows for spot ETH ETFs have now totaled approximately -$568.30 million, accentuating a persistent pattern of investor withdrawals. This trend underscores the current market conditions prompting investors to reduce their exposure to ETH in recent weeks.