Ethereum’s growing interest among investors has driven U.S. spot ETH ETFs to a weekly all-time high in total netflows, with $752.9 million recorded.
Ethereum spot ETFs provide U.S. institutional and retail investors with a way to gain exposure to the cryptocurrency without directly owning the digital asset.
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Posted December 6, 2024 at 1:17 pm EST.
Ether (ETH), the native cryptocurrency for the Ethereum blockchain, has reached a nearly nine-month high in price, amidst record inflows for spot ETH exchange-traded funds (ETFs).
The price of ETH has jumped 3.5% in the last 24 hours and 9.6% in the past seven days to trade hands at $4,016.87, a level not seen since March 2024, giving the digital asset a market cap of $480.5 billion at presstime, per CoinGecko.
“$4000 to me is a psychological resistance level that matters,” wrote Nicolai Sondergaard, research analyst at blockchain analytics firm Nansen, in Telegram comments.
However, analysts are waiting for clearer signals to become confident that Ethereum’s price will continue to increase. Sondergaard said, “I want to see a clearer conviction on the ETHBTC chart that Ethereum indeed is seeing increased strength and not purely short-term momentum.”
In a similar vein, Maksim Balashevich, the founder of data insights platform Santiment, told Unchained that he “hasn’t seen yet the ultimate toppish metrics, but will closely observe if the break of $4K in ETH will lead towards ‘relax and wait for higher prices’ or rather ‘let’s stay active, markets aren’t cleared up yet.’”
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A Boost From Spot ETH ETFs
ETH’s upswing to $4,000 comes as U.S. spot Ethereum ETFs are seeing increased positive netflows (inflows minus outflows). “It is significant that we are finally starting to see and have seen inflows to the ETH ETFs which otherwise have been the clear black sheep of the family,” Sondergaard wrote. For the majority of the time since U.S. spot ETH ETFs launched, cumulative netflows were negative until last month after Donald Trump won the 2024 presidential election.
Recently, spot ETH ETFs have had nine straight days of positive netflows, the longest consecutive streak since they started trading in July 2024, according to analytics from financial research platform SoSo Value.
The interest in ETH has propelled the spot ETFs to a weekly all-time high in total netflows of $752.9 million, a sign of increasing demand for the financial vehicles that enable institutional and retail investors in the U.S. to gain exposure to the cryptocurrency without directly owning the asset.
Zooming out, the total net value of all ETH held by U.S. spot Ethereum ETFs as of Friday stands at $12.4 billion, making up roughly 2.7% of the entire Ethereum market cap. While Grayscale has the lion’s share at about $5.7 billion, it has seen the largest negative netflows at -$3.4 billion in part because its fee of 2.5% is multitudes higher than the average of the remaining eight ETFs at 0.21%. BlackRock’s ETHE leads net inflows for all spot ETH ETFs at $2.6 billion, while Fidelity’s FETH takes second place at nearly $1.1 billion.
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Onchain Activity Rising
Meanwhile, Ethereum and its L2 networks have seen increased onchain activity. “Ethereum has regained prominence as an expensive chain for trading, generating approximately $43 million in fees this week,” according to commentary from venture capital firm Ryze Labs that was published to X on Friday.
“Similarly, Base [an L2 incubated by Coinbase] managed to maintain robust activity despite losing 350,000 daily active wallets [this week], with $11.6 billion in [decentralized exchange] volume driven by cbBTC, AI agents, and memecoins,” stated Ryze Labs. Onchain intelligence firm Artemis shows that Base’s daily active addresses stood at 1.2 million on Nov. 29 and as of Dec. 5, the figure stood at 904,000.
