Ethereum

Solana

Spot

Spot Ethereum exchange-traded funds, or ETFs, had seven consecutive days of outflows shedding over $5.7 million in assets on Friday, Aug. 23, bringing the cumulative figure to $464 million, data by SoSoValue shows. 
Cumulative net assets locked in these Ethereum (<a href="https://crypto.news/price/ethereum/" target="_blank" rel="noreferrer noopener">ETH</a>) ETFs stand at about $7.65 billion. 
The Grayscale Ethereum Trust has $5 billion followed by the Grayscale Mini Ethereum Trust with $1.01 billion. It is followed by ETFs from Blackrock, Fidelity, Bitwise, and VanEck. 
 You might also like: <a href="https://crypto.news/spot-ethereum-etf-approval-is-looming-2-reasons-to-avoid/"> Spot Ethereum ETF approval is looming: 2 reasons to avoid </a> 
<h2 class="wp-block-heading" id="institutional-investors-reluctance">Institutional investors reluctance</h2> 
In a <a href="https://www.bloomberg.com/news/articles/2024-08-23/investors-are-slow-to-embrace-ether-etfs-one-month-after-debut?srnd=phx-crypto" target="_blank" rel="">note to Bloomberg</a>, crypto analyst Noelle Acheson noted that many institutional investors are a bit reluctant to invest in Ethereum ETFs and prefer to focus on Bitcoin (<a href="https://crypto.news/price/bitcoin/" data-type="link" data-id="https://crypto.news/price/bitcoin/">BTC</a>) for their diversification efforts. 
However, she expects that Ether ETFs will likely see more inflows in the future, akin to the metal industry, where <a href="https://www.etf.com/topics/gold" target="_blank" rel="">gold ETFs</a> hold over $100 billion in assets while those tracking silver have less than $20 billion. 
<h2 class="wp-block-heading" id="the-opportunity-cost">The opportunity cost</h2> 
The other reason why Ethereum ETFs are struggling is the opportunity of holding them vis-a-vis buying Ether.&nbsp; 
Buyers of the cheapest Ether ETF — Grayscale Mini Ethereum — will pay a small expense ratio of 0.15%. However, they will also avoid making money through staking. 
Data by <a href="https://www.stakingrewards.com/asset/ethereum-2-0" target="_blank" rel="">StakingRewards</a> shows that Ethereum yields about 3% or $300 if you invest $10,000 in it.&nbsp; 
The data shows that Ethereum’s net staking inflow has risen in 20 of the last 30 days, reaching over $93.7 billion. Therefore, since Ether ETFs track Ethereum prices, many investors are opting for Ether. 
<h2 class="wp-block-heading" id="ethereum-is-underperforming-bitcoin">Ethereum is underperforming Bitcoin</h2> 
<figure class="wp-block-image size-full">
 <picture loading="lazy" decoding="async" class="wp-image-14293703"> 
 <source type="image/webp" srcset="https://crypto.news/app/uploads/2024/08/Eth-vs-Bitcoin.png.webp"> 
 <img loading="lazy" decoding="async" width="3574" height="1982" src="https://crypto.news/app/uploads/2024/08/Eth-vs-Bitcoin.png" alt="Ethereum vs Bitcoin"> 
 </picture> 
 <figcaption class="wp-element-caption">
 Ethereum vs Bitcoin YTD performance | Source: <a href="https://www.tradingview.com/symbols/ETHUSD/?exchange=BINANCE" target="_blank" rel="">TradingView</a>
 </figcaption>
</figure> 
Another likely reason is that Bitcoin is doing better than Ether this year. It has risen by over 45% while ETH is up by less than 20%. 
This performance is likely because Ethereum is facing substantial competition from Solana (<a href="https://crypto.news/price/solana/" data-type="link" data-id="https://crypto.news/price/solana/">SOL</a>) and Tron (<a href="https://crypto.news/price/tron/" data-type="link" data-id="https://crypto.news/price/tron/">TRX</a>). 
Tron has become a major player in stablecoin transactions, handling daily volumes of over $40 billion. Similarly, Solana has seen substantial traction because of its meme coins. As a result, in July, Solana was the biggest chain in DEX volumes,<a href="https://defillama.com/dexs/chains" target="_blank" rel=""> handling over $58 billion</a>.&nbsp; 
Ethereum’s ETF performance will likely be a red flag for financial services companies considering launching other altcoin ETFs like Solana and Avalanche. 
 You might also like: <a href="https://crypto.news/solana-etfs-have-just-suffered-a-huge-setback-heres-why/"> Solana ETFs have just suffered a huge setback — here’s why </a>

Here’s why Ethereum ETF inflows are lagging behind Bitcoin

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