5 October 2023
Apart from Spot Bitcoin ETFs, Ethereum Futures ETFs have been the talk of the crypto industry for months as investors look toward a catalyst for the next bull run. However, data has shown the highly anticipated ETFs have had underwhelming results in trading volume.
Although the crypto market has witnessed some gains in the past few days, this hasn’t flowed into Ethereum Futures ETFs as investors seem hesitant to adopt these new Ethereum investment vehicles.
How Have Ethereum Futures ETFs Fared So Far?
Ethereum futures ETFs provide indirect exposure to the price of ETH through futures contracts and Nine Ethereum Futures ETFs were introduced to the market on Monday, October 2nd. These include ETFs by ProShares, VanEck, Bitwise, and other financial firms following a year of anticipation.
As the second biggest cryptocurrency by market cap, many expected the ETFs to take off quickly and piggyback on the early success of Bitcoin Futures ETFs. However, data shows the trading volume for these new products has remained relatively low so far.
According to a report by Bloomberg, these nine futures ETFs attracted $1.92 million in the 24 hours after launch. Most of this trading occurred in the ProShares Ether Strategy ETF which contributed over 45% of trading volume.
Pretty meh volume for the Ether Futures ETFs as a group, a little under $2m, about normal for a new ETF but vs $BITO (which did $200m in first 15min) it is low. Tight race bt VanEck and ProShares in the single eth lane. pic.twitter.com/F9AHtrVcVf
— Eric Balchunas (@EricBalchunas) October 2, 2023
According to data compiled by Bloomberg Intelligence, trading volume reached $15.6 million on Wednesday. At the moment, the inflows are being led by the VanEck Ethereum Strategy ETF (EFUT), which has $8.27 million, followed by the ProShares Ether Strategy ETF (EETH), which has $5.96 million.
Ether futures ETFs starting see some flows, not a ton, but it’s something, +$15.6m with VanEck in an early lead over ProShares.. pic.twitter.com/e0bu7T0ZLT
— Eric Balchunas (@EricBalchunas) October 4, 2023
In comparison, Bitcoin Futures ETFs registered $1 billion in trading volume within the first 24 hours after launch. But it’s important to note that the market sentiment during these two periods wasn’t the same. Bitcoin futures ETFs were launched during the peak of the 2021 crypto bull market, and cryptocurrencies have had major pullbacks since then.
Future Outlook Of ETH
While Ethereum futures ETFs provide a new way to gain exposure to Ethereum, low trading volume shows they have yet to gain major mainstream interest. These ETFs were supposed to be a sustained catalyst for the price of Ethereum, but this has not been the case.
Ethereum Spot ETFs have also been in the talks, with ARK Invest filing the first application in early September. If granted approval, spot ETFs are more likely to have a better performance than futures ETFs.
Despite Ethereum pushing over $1,700 on Monday after the launch of the futures ETFs, it has since lost all those gains. At the time of writing, Ethereum is trading at $1,630.