Ethereum Futures ETFs Debut with Modest Trading Volumes
In the first 15 minutes of trading, the debut of Ethereum futures ETFs on CME saw a modest start, with volumes below $2 million. This is significantly lower compared to Bitcoin-based ETFs, which had volumes one hundred times greater. Bloomberg analyst Eric Balchunas notes that while these numbers are common for new ETFs, they are relatively low for Ethereum given its market size. Valkyrie’s ETF, based on a combination of the first and second-largest cryptocurrencies by market capitalization, performed the best with a trading volume of $787,000. VanEck’s Ethereum futures-only ETF had a modest volume of just over $300,000.
Turnover for Ethereum Futures ETFs Reaches $1.92 Million
The total turnover for six exchange-traded funds based on Ethereum futures reached $1.92 million by the end of the day. ProShares Ether Strategy ETF accounted for $879,000 of this turnover. The six new funds by ProShares, VanEck, and Bitwise Asset Management allow investors to take positions in exchange-traded products based on Ether for the first time. However, compared to two years ago when Bitcoin ETF trading began, the current bear market has made competition tougher. Investors may also be anticipating spot versions of ETFs, primarily Bitcoin, possibly in early 2024. The US Securities and Exchange Commission (SEC) has been delaying consideration of applications for a spot Bitcoin ETF.
Hot Take: Anticipation for Spot Versions Keeps Ethereum Futures ETF Volumes Low
The modest trading volumes observed for the debut of Ethereum futures ETFs can be attributed to several factors. Firstly, compared to Bitcoin-based counterparts, the volumes were significantly lower due to investor preference for Bitcoin. Additionally, the current bear market has made competition tougher, leading to subdued interest in Ethereum-based ETFs. Investors may also be holding off on investing in these futures ETFs as they anticipate the introduction of spot versions, particularly for Bitcoin, which is expected to occur in early 2024. However, the US Securities and Exchange Commission’s delay in considering applications for a spot Bitcoin ETF has further contributed to the low volumes of Ethereum futures ETFs.
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