A recent report from CoinShares revealed that Ethereum (ETH) experienced a surge in inflows last week, overtaking Solana’s (SOL) inflows for the year 2024. This coincides with the upcoming launch of exchange-traded funds (ETFs) that will enable regulated investment in the US for the second-largest cryptocurrency by market capitalization.
Strong Momentum for Ethereum
The report highlights Ethereum’s strong momentum in the past month, with inflows reaching $45 million last week, totaling over $103 million for the year. This outpaces Solana’s inflows year-to-date. Despite this, Solana also saw inflows of $9.6 million during the same period, resulting in a YTD total of $71 million, which lags behind Ethereum’s inflows.
Among other altcoins, Litecoin was the only one to receive inflows exceeding $1 million, with $2.2 million recorded last week. The report also indicates that general digital asset investment products continued to see buying interest, with inflows amounting to $1.35 billion last week, contributing to the recent recovery in crypto prices.
The trading volumes of exchange-traded funds saw a significant increase by 45% week-on-week, reaching $12.9 billion. However, these volumes only accounted for 22% of the broader crypto market volumes, indicating a relatively lower proportion. Bitcoin (BTC) recorded $1.27 million in inflows last week, while short-bitcoin ETPs experienced outflows of $1.9 million, amounting to $44 million since March.
SEC Approval of Ethereum ETFs
The Securities and Exchange Commission (SEC) is expected to fully approve spot Ethereum ETFs today, clearing the path for a second cryptocurrency investment vehicle in the US that has the potential to attract billions of dollars in retail and institutional investor cash. Industry experts anticipate that this approval will have a significant impact on the Ethereum blockchain and its decentralized finance (DeFi) protocol.
James Seyffart, an ETF expert at Bloomberg, anticipates the commencement of trading for Ethereum ETFs tomorrow. This regulatory milestone follows the approval of Bitcoin ETFs in January, and experts speculate that the approval of Ethereum ETFs will greatly influence the DeFi ecosystem. Mark Connors, the head of global macro strategy at Onramp, referred to Ethereum as the “middle kid protocol,” emphasizing the importance of the ETF launch for the DeFi ecosystem.
Ethereum’s Future Price Impact
The success and participation in the ETF launch will provide insight into Ethereum’s ability to maintain its market position, attract sustained interest, and increase inflows and adoption. These factors could potentially result in a significant impact on Ethereum’s price in the foreseeable future.