Spot Ethereum exchange-traded funds (ETFs) witnessed a significant outflow of $14 million in the past week, according to a report by Barclays analysts released on Monday.
This withdrawal occurred even as ether, the cryptocurrency tracked by these ETFs, experienced a 2.19% increase over the same period.
The primary driver of these outflows was Grayscale’s Ethereum Trust (NYSE), which saw $118 million leave the fund. This decline was somewhat mitigated by a $2 million inflow into Grayscale’s Ethereum Mini Trust (NYSE), the second-largest spot ether ETF by net assets.
“Grayscale experienced a disproportionate share of the outflows from their Ethereum Trust, though this was partially balanced by inflows into their mini Ethereum Trust,” the report stated.
Additionally, the VanEck Ethereum ETF (NYSE) faced $8 million in net outflows, contributing to the overall negative trend. Conversely, BlackRock’s iShares Ethereum Trust ETF (NASDAQ) saw the most substantial inflow, with $76 million, followed by the Fidelity Ethereum Fund (NYSE) which attracted $26 million.
The report also highlighted potential implications for Coinbase (NASDAQ), which acts as the custodian and prime broker for six of the Ethereum ETFs, as well as eight spot Bitcoin ETFs.
“Coinbase could benefit from an increase in assets under management and redemption/creation activity, but it might also face intensified competition for trading volumes,” the analysts noted.
Barclays pointed out that although ETF trading volumes remain relatively modest compared to on-exchange cryptocurrency trading, they have consistently accounted for about 2% of spot crypto trading volumes over the past week.
The analysts also announced that this would be their final weekly update on Ethereum ETF flows, as they transition to a monthly crypto report that will include Bitcoin ETF flows.
The nine spot Ethereum ETFs, launched on July 23, represent the second group of funds linked to the current price of a major cryptocurrency. This followed the introduction of spot Bitcoin ETFs on January 11, marking a significant milestone after nearly a decade of resistance from the Securities and Exchange Commission (SEC) against such products.
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