Ethereum futures ETFs get off to slow start

Ethereum futures ETFs get off to slow start

Six Ethereum futures ETFs got off to a slow start after launch on Monday. The funds have attracted just under $2 million in trading volume.

Investors haven't shown interest in Ethereum futures ETFs.

The launch of six Ethereum futures ETFs in the US on Monday was 'disappointing', said K33 Research's Vetle Lund.

The shallow flows depict a empty market and a deficient demand for Ethereum exposure, he said.

Futures ETFs deal with the future value of an asset whereas spot ETFs deal with the current value of an asset.

There have been no crypto spot ETFs approved by US regulatory agencies so far, but several big financial firms such as BlackRock and Fidelity have applied to launch them.

ProShares' EETH and VanEck's EFUT were both the most popular Ethereum-only funds, with a trading volume of around $850,000 and $500,000.

Nearly 50 percent of EFUT's trading volume occured during its first minute of trading, Lund said.

ProShares is expected to lead the way when it comes to Ethereum, similar to Bitcoin futures ETFs.

While the launch mirrored Bitcoin's 2021 debut in this sense, it was completely different when it comes to volume.

In just two days, Bitcoin futures ETFs clocked up over $1 billion in trading volume - ProShares's BITO did $200 million in the first 15 minutes.

ProShares's BITO, which broke records, launched at the height of the bull market in 2021 - a'more opportune environment', Lund said.

Bitcoin is also just more popular among, especially among those with a casual interest in cryptocurrency, Balachunas said in an interview at Bloomberg Intelligence ETF.

Crypto market makers QCP Capital said a futures ETF could result in synthetic trading activity without actually impacting spot supply.

Traders are buying futures contracts, speculating on prices at a future date, and don't need to hold Ethereum - instead of buying a spot product that holds the underlying asset, and therefore affects spot supply.

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Adam Morgan McCarthy is a London-based Markets Correspondent at DL News.