Ethereum Futures ETFs had a lukewarm start with only $1.92 million in trading volume. Ethereum’s price dipped 4% on launch day, drawing comparisons to Bitcoin’s ETF launch.
Key Points
- Ethereum Futures ETFs kicked off with a slow start, amassing $1.92 million trading volume.
- Despite a price spike before the launch, Ethereum’s value showed a 4% decline on the launch day.
- Analysts observe parallels with Bitcoin’s launch, hinting at a possible similar trajectory for Ethereum.
- The SEC has postponed decisions on Ethereum spot ETF approvals until at least the end of 2023.
A tepid reception welcomed the launch of Ethereum Futures exchange-traded funds (ETF) this week, puzzling the crypto community and baffling speculators who anticipated a robust debut.
Despite the eager anticipation, the trading volume of six funds, including the heavyweight ProShares Ether Strategy ETF, only tallied up to a mere $1.92 million.
Disappointing stats on the first day of Ethereum Futures ETFs 📊:
📉 First-day trading volume: $1.96M
Vaneck's EFUT fund, which pledged to contribute 10% of ETF profits to the Ethereum HST, saw only a meager $400K in trading volume on its first day.
To put things in… pic.twitter.com/mMWEhZwc6s
— Thong Xmademoney (@BierleLat815) October 3, 2023
Ethereum Futures ETFs Launch
Prior to the October 2nd launch, optimists propelled Ethereum’s price upward by roughly 4.5%, peaking at $1,734 on October 1st. However, contrary to expectations, the coin wrapped up the launch day at $1,659, reflecting a 4% dip, and currently sits at $1,643.
Comparisons were inevitably drawn with the ProShares Bitcoin Strategy ETF (BITO), which phenomenally attained $1 billion in flows merely two days post-launch in 2021, a stark contrast to the underwhelming performance of Ethereum’s ETFs.
Observers also noted that on October 2, the Ethereum Futures ETFs’ six funds collectively posted a trading volume of $1.92 million, of which the ProShares Ether Strategy ETF single-handedly accounted for a substantial 45.7% ($878,560).
Despite the initial disappointment, seasoned analysts advise against hasty conclusions. Eric Balchunas, a senior ETF analyst at Bloomberg, cited historical precedence, remarking, “Any crypto-related launch tends to be a ‘buy the rumor, sell the news’ event.”
He also recalled Bitcoin’s price decrease following BITO’s demand surge and hinted that Ethereum might navigate a parallel path.
The anticlimactic commencement of Ethereum’s Futures ETFs, characterized by modest trading volumes and a subsequent dip in Ethereum’s price, stirs recollections of Bitcoin’s debut and prompts intriguing speculations regarding Ethereum’s future trajectory.
Concluding Thoughts
The moderate trading volumes and price dynamics might be considered a ‘cooling off’ phase after the pre-launch hype, reflecting a “buy the rumor, sell the news” phenomenon, as observed with other cryptocurrency-related launches.
Nevertheless, while comparisons with Bitcoin’s initial trajectory offer a semblance of reassurance, it’s crucial to acknowledge that Ethereum possesses its own unique market dynamics and external influencers, thereby rendering its path somewhat unpredictable.
What is evident, though, is that the realm of cryptocurrency ETFs remains in its nascency, brimming with potential and uncertainties alike.
The postponement of SEC decisions on Ethereum spot ETFs further propels this narrative, indicating a cautious regulatory stance amidst the burgeoning crypto market.
Thus, while this launch may not have ignited the fireworks initially expected, it forms a pivotal chapter in the unfolding story of Ethereum ETFs and will undoubtfully provide valuable insights for future endeavors in the crypto ETF space.
