Institutional investors are seizing the opportunity to buy Ethereum at lower prices as spot Ethereum exchange-traded funds (ETFs) experience a return to positive inflows. This trend, however, does not extend to Bitcoin funds.
Following a significant market crash that saw Ethereum plummet by 23% within 24 hours, U.S. spot Ethereum ETFs had a positive influx of funds. On August 5, the nine newly launched spot ETH ETFs collectively saw an inflow of $49 million, marking the second-highest inflow day since their inception. This marked only the fourth day of inflows over the past ten trading days, indicating that institutional investors are indeed buying the Ethereum dip.
ETF specialist James Seyffart confirmed this trend in a post on X on August 6, stating, “ETF investors, in aggregate, likely bought the dip on Ethereum today.”
Ethereum Dip Buyers
BlackRock’s ETHA fund led the inflows with $47.1 million, bringing its total to $760 million. VanEck’s ETHV fund followed with $16.6 million, closely trailed by Fidelity’s FETH with $16.1 million.
Bitwise’s ETHW fund saw an inflow of $7.2 million, while Grayscale’s Ethereum Mini Trust (ETH) received $7.6 million. However, the main Grayscale ETHE fund experienced an outflow of $46.8 million, the lowest since its conversion to a spot ETF.
Ethereum ETF Flow (US$ million) – 2024-08-05
TOTAL NET FLOW: 48.8
(Provisional data)ETHA: 47.1
FETH: 16.2
ETHW: 7.2
CETH: 0
ETHV: 16.6
QETH: 0
EZET: 0.9
ETHE: -46.8
ETH: 7.6For all the data & disclaimers visit:https://t.co/HfqQHgwr3Z
— Farside Investors (@FarsideUK) August 6, 2024
In contrast, Bitcoin funds did not see the same dip buying activity. Preliminary data from Farside Investors indicated an outflow of $168.4 million from Bitcoin funds on Monday. Fidelity, Ark 21Shares, and Grayscale all recorded outflows between $58 to $70 million, while BlackRock and four other funds registered zero flows. Grayscale’s Mini Bitcoin Trust had a minor inflow of $21.8 million, and Bitwise (BITB) and VanEck (HODL) each saw around $3 million.
Bitwise CIO Matt Hougan noted that while there was some dip buying for their funds, the primary focus was on Ethereum.
We had net inflows into both our Bitcoin and Ethereum ETFs today. ETF investors buying the dip.
— Matt Hougan (@Matt_Hougan) August 6, 2024
ETH Price Outlook
On August 5, Ethereum markets experienced a severe decline, with the asset dropping to its lowest price in 2024 at $2,171. This 34% decrease within less than a week marked the steepest and fastest decline since May 2022. However, during the Tuesday morning Asian trading session, ETH showed signs of recovery, reclaiming the $2,500 mark.
For the uptrend to continue, Ethereum needs to break through the resistance at $2,900, a process that could be slow, especially if Bitcoin’s recovery remains sluggish.
