Ether ETFs Launch with Low First-Day Volume

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Ether ETFs

Ether ETFs experienced a lackluster debut on their first day of trading. Nine ETFs were launched, providing exposure to ether futures, with five holding only ether futures and four holding a mix of bitcoin and ether futures. Among the new ETFs, VanEck’s Ethereum Strategy ETF (EFUT) traded just under 25,000 shares at an average price of $17 per share on Monday, resulting in a total dollar volume of merely $425,000. In comparison, the ProShares Bitcoin Strategy ETF (BITO), which launched in October 2021, had a trading volume of over $1 billion on its first day. Bloomberg ETF analyst Eric Balchunas characterized the Ether Futures ETFs’ volume as “pretty meh.”

In a bid to bring Ethereum further into the US regulatory perimeter, Grayscale Investments, in collaboration with NYSE Arca, has submitted an application to the US Securities and Exchange Commission (SEC) for approval to convert the Grayscale Ethereum Trust (ETHE) into a spot ethereum exchange-traded fund (ETF). With nearly $5 billion in assets under management, Grayscale’s Ethereum trust is the world’s largest ether investment product. Grayscale CEO Michael Sonnenshein acknowledged the significance of this move, stating, “As we file to convert ETHE to an ETF, the natural next step in the product’s evolution, we recognize this as an important moment.”

Sam Bankman-Fried, the former crypto boss, is seeking to prevent the government from calling multiple witnesses, including company investors and a Ukrainian customer, in his upcoming trial. He has pleaded not guilty to multiple counts of fraud after FTX filed for bankruptcy in November. Bankman-Fried does not want former company insiders to testify about the meaning of supposedly “coded” expressions used as part of an alleged conspiracy to misuse customer funds. In a filing made public on Tuesday, his lawyer, Mark Cohen, argued that the request was “premature” and would lead the jury to conclusions they should draw for themselves.

Despite the slow start, Ether ETFs have the potential to gain traction in the market as investors become more familiar with the product. As the world’s second-largest cryptocurrency, Ethereum has attracted significant interest from both retail and institutional investors. The launch of Ether ETFs provides a new avenue for investors to gain exposure to the cryptocurrency without directly owning the underlying asset.

In addition to the nine ETFs launched, more Ether ETFs are expected to enter the market in the coming months, providing investors with a wider range of options to choose from. This increased variety could help boost trading volumes and attract more investors to the Ether ETF market. Furthermore, the potential conversion of Grayscale’s Ethereum Trust into a spot ETF could also serve as a catalyst for increased interest in Ether ETFs.

While Ether ETFs may have had a slow start, it is essential to remember that the cryptocurrency market is still relatively young and constantly evolving. As the market matures and more investors become comfortable with the idea of investing in digital assets, it is likely that Ether ETFs will experience growth in trading volumes and assets under management.

In conclusion, although Ether ETFs did not have an impressive debut, the market is still in its infancy and has room for growth. The launch of additional Ether ETFs, coupled with the potential conversion of Grayscale’s Ethereum Trust into a spot ETF, could contribute to increased interest and trading volumes in the future. As the cryptocurrency market continues to evolve, Ether ETFs may become an increasingly popular investment option for those looking to gain exposure to Ethereum without directly owning the digital asset.