According to a recent report from CoinShares, Ethereum (ETH) saw a surge in inflows last week, surpassing Solana’s (SOL) inflows for 2024, coinciding with the upcoming launch of exchange traded funds (ETFs) that enable regulated investments in the US for the second largest cryptocurrency by market capitalization.
ETH dominates the inflow
The report highlights Ethereum’s strong momentum recorded over the past month, with inflows reaching $45 million last week, representing annual revenues of over $103 million, surpassing Solana’s inflows year-to-date (YTD).
However, Solana also witnessed inflows of $9.6 million during the same period, resulting in a YTD total of $71 million, which lags behind that of Ethereum. inflow. Among other altcoins, Litecoin was the only one to receive inflows of more than $1 million, hitting a record $2.2 million last week.
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The report also shows that general investment products for digital assets saw continued buying, with inflows totaling $1.35 billion last week, bringing the three-week inflows to $3.2 billion, impacting the recovery in crypto prices in recent weeks.
In addition, trading volumes of exchange-traded funds increased significantly by 45% week-on-week to $12.9 billion. However, these volumes represented only 22% of the broader volume crypto market volumes, indicating a relatively lower share.
Bitcoin (BTC), on the other hand, recorded inflows of $1.27 million last week, while short bitcoin ETPs recorded outflows of $1.9 million. Strikingly, these outflows amounted to $44 million since March, representing 56% of assets under management (AuM).
Ethereum prepares for ETF breakthrough
The Securities and Exchange Commission (SEC) is expected to fully approve spot Ethereum ETFs today, paving the way for a second cryptocurrency investment vehicle in the US that could attract billions of dollars in cash for retail and institutional investors. James Seyffart, Bloomberg ETF expert, noted:
What do we expect from the Ethereum ETFs today? We expect them to start trading tomorrow. That means we should see some filings on the SEC’s site today stating that the ETFs’ prospectuses have become “effective.” Probably after or around the market close.
Ahead of this regulatory victory for the market following the approval of Bitcoin ETFs in January, industry experts are speculate that the SEC’s approval of Ethereum ETFs will have a significant impact on the Ethereum blockchain and the decentralized finance protocol (DeFi).
Mark Connors, head of global macro strategy at Onramp, a Dallas-based financial services firm, referred to Ethereum as the “middle kid protocol,” highlighting the crucial test the ETF launch represents for the DeFi ecosystem.
According to Connors, the success and participation in Tuesday’s ETF launch will shed light on Ethereum’s ability to maintain its market position and generate sustainable interest, along with greater inflows and adoption, which could have a significant impact on the price.
Despite being just a few hours away from the start of ETF trading, ETH is trading at $3,450, down 1.5% in a 24-hour time frame, supported by the $3,435 wall below the current price, which has prevented further downward price action since Friday.
Featured image of DALL-E, chart from TradingView.com
