TL;DR
- Ethereum ETFs set a record with $2.08 billion in net inflows in December, nearly doubling November’s $1 billion.
- BlackRock led the growth with $1.4 billion in inflows, followed by Fidelity with $752 million, while Grayscale experienced $274 million in net outflows.
- Total net assets of Ethereum ETFs reached $12.12 billion, representing over 3% of Ethereum’s market capitalization.
Investor interest in ether-backed financial products hit a new high in December as Ethereum exchange-traded funds (ETFs) recorded $2.08 billion in net inflows. This figure nearly doubled the $1 billion reported in November, according to data from SoSoValue.
BlackRock’s ETHA fund led the market, attracting $1.4 billion in net inflows and standing out with 13 consecutive days of positive contributions. Fidelity followed closely, securing $752 million with its FETH fund, making it the second-largest recipient of investments. However, Grayscale’s ETHE fund reported $274 million in net outflows, underscoring that not all funds benefited from the rising demand.
Despite this, the total net assets of Ethereum ETFs reached $12.12 billion, representing more than 3% of Ethereum’s market capitalization. This milestone highlights the growing appetite among institutional and retail investors for Ethereum-focused financial products.
Impact of Ethereum’s Rally and Comparison to Bitcoin
The record inflows coincided with a mid-month rally in Ethereum prices, which briefly exceeded $4,000 before retreating to $3,500. By the end of December, Ethereum was trading at $3,409, reflecting a 2.23% increase in the last 24 hours.
In comparison, Bitcoin ETFs reported $4.5 billion in net inflows for December, a decline from November’s record-breaking $6.4 billion. Bitcoin peaked at $108,135 on December 17 before stabilizing around $95,556. This shows a more volatile performance in Bitcoin-focused ETFs compared to Ethereum’s steadier inflow trend.
The strong performance of cryptocurrency ETFs, particularly Ethereum, highlights their growing role as essential financial tools for portfolio diversification. With Ethereum increasingly being recognized for its technological and economic potential, analysts believe this upward trend could continue into 2024, solidifying its place as a core asset for institutional portfolios.
