Ethereum’s price performance has been on a downward trend for the past few weeks, which has become a major concern for investors. What makes the token’s struggles even more worrying is that the recent launch of a spot ETH ETF (exchange-traded fund) in the United States shows no signs of relief.
However, it also appears that the disappointing performance of the ETH ETF so far may have contributed to the turmoil in Ethereum prices in recent weeks. Specifically, Grayscale has seen significant outflows from its Ethereum fund, Grayscale Ethereum Trust (ETHE).
Grayscale Ethereum Trust outflow hits $2.1 billion
Following the close of its first week of trading, the U.S. spot Ethereum ETF market has seen a significant outflow of funds from cryptocurrency products. According to data from SoSoValue, a total of $169.35 million has flown out of ETH exchange-traded funds in the past week.
While this amount is still a significant outflow from spot Ethereum funds, it is over 50% lower than the outflows seen in its debut week, which saw a net outflow of over $341 million from the ETH ETF market.
The main contributor to this level of outflows is Grayscale Ethereum Trust, which saw over $2.1 billion in outflows over the past two weeks, with ETHE seeing over $1.5 billion in net outflows in its launch week.
Grayscale Ethereum Trust (ETHE) | Source: SoSoValue
According to data from SoSoValue, a total of $61.43 million was withdrawn from Grayscale Ethereum Trust on Friday, August 2. This latest movement brings ETHE’s total net assets to just under $6 billion.
Similar to when the Spot Bitcoin ETF launched, Grayscale’s ETHE holders appear to be redeeming shares from the fund after not being able to do so for years, and just like with BTC, the massive outflows appear to be putting considerable downward pressure on Ethereum prices.
Ethereum Price Overview
At the time of writing, Ethereum is priced at around $2,907, down 2.2% in the past 24 hours. According to data from CoinGecko, the cryptocurrency has fallen by more than 10% in the past seven days.
This performance over the past seven days highlights the ETH token’s struggles over the past few weeks: Ethereum’s price has fallen about 8% over the past month, according to data from CoinGecko.
Nonetheless, Ether maintains its position as the second-largest cryptocurrency in the space, with a market capitalization of over $347 billion.
The Ethereum price on the daily timeframe | Source: ETHUSDT chart on TradingView
Featured image from iStock, chart from TradingView
