Ethereum ETFs Launched: How Did the First Week Go?

We have been writing about this for a while. Finally, after delays and anticipation, the Ethereum-based exchange traded funds (or ETF) have finally been launched on the stock exchange and it has been possible to trade them for the entire week just ended. The launch was undoubtedly encouraging, but it cannot be said that everything went according to plan. Let's elaborate on this by pointing out, right off the bat, how the sentiment of investors remains quite positive towards this newly launched product.

Ethereum ETFs' performance

The official launch date for Ethereum ETFs on Wall Street indices was last Tuesday, 23 July. On the first day, partly due to the palpable curiosity of investors, this product went really strong in the market. The ETFs sold by BlackRock, through iShares, and those offered by Bitwise, generated profits of $266.5 million and $204 million, respectively. Fidelity, Grayscale Mini, and Franklin also did well, while 21Shares, VanEck, and Invesco did not post big gains and were content with a launch that generated revenues of 7.5; 7.6; and 5.5 million.

In the face of these positive numbers, however, there are also those who posted very negative ones. In fact, Grayscale lost as much as $1.5 billion in the four days of trading last week, with a hole of over $480 million in the first day of trading alone. This is a figure that corresponds to 17% of the firepower with which the Grayscale Ethereum ETFs had entered the market. The correct word to use in this case is ecatombe. No other providers posted losses - sure, some posted a round zero in the days after the 23rd, like 21Shares, VanEck, Invesco, and Franklin - but only Grayscale went negative, and lost countless millions.

Comparison with Bitcoin ETFs

Grayscale had also started off rather poorly a few months ago, when the Bitcoin ETFs, the first cryptocurrency-related asset to be made available on the mainstream financial markets, were dropped. Initial losses were in the millions that time too, in the first four days. This is the typical length of trading in the first week, since the markets update on Tuesday, not Monday, but the blow was more easily absorbed. In fact, the fund started at almost 30 billion. The one related to Ethereum, from no more than 9.1.

What to expect now?

The fact that 1.5 billion in sales of Ethereum ETFs by Grayscale found no investors is serious, when viewed through the lens of the US asset management firm. However, it has not impacted the market for these assets to any great extent, since it occurred at a time of great confidence on the part of traders, who continue to maintain a generally positive sentiment towards this product. Indeed, Ethereum ETFs have only just been launched and the honeymoon with investors is still going on.

Given this background, Grayscale itself is confident that it will be able to scale back its loss in the coming days and weeks and, who knows, perhaps even return to positive ground. Attention to financial products of this type, linked to cryptocurrencies but traded within traditional stock market indices, is very high, and Grayscale's difficulties may simply be a bump in the road under the tarmac of the direct road to success for this new financial product.

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