Ether ETF Sees $2.6 Billion in Net Inflows for December
Bitcoin Exchange-Traded Funds (ETFs) trail behind their BTC counterparts in terms of growth, despite a strong finish to 2024, boasting net inflows
The end-of-year numbers are in, and Ethereum exchange-traded funds (ETFs) have seen a significant surge in popularity, surpassing $2.6 billion in net inflows for the month of December alone. This milestone marks a notable increase in investor interest in Ether-based ETFs, which have been gaining traction against their Bitcoin counterparts.
A Record-Breaking Week for Ethereum ETFs
According to data from Farside Investors, Ethereum ETFs experienced eight consecutive weeks of net inflows, culminating in a record-breaking $2.2 billion in the week of November 26. This remarkable uptick in investor enthusiasm has pushed Ether-based ETFs into the spotlight, with many analysts predicting that they may even outperform their Bitcoin counterparts in the coming year.
The Lagging Gap between Ethereum and Bitcoin ETFs
While Ethereum ETFs have seen significant growth, they still lag behind Bitcoin ETFs, which closed out 2024 with a whopping $35 billion in net inflows. However, Farside Investors suggests that this gap may narrow or even reverse in the coming year, particularly if Ether’s price performance improves and regulators allow ETH-based ETFs to generate yields from staking.
Top Performing Ethereum Funds
BlackRock’s iShares Ethereum Trust (ETHA) led the pack among its peers, onboarding a staggering $3.5 billion in net inflows for 2024. Fidelity Ethereum Fund (FETH) came in second place, with $1.5 billion in net inflows, while Grayscale Ethereum Trust (ETHE) saw significant outflows of $3.6 billion.
Grayscale’s ETHE: A Cheaper Alternative?
In July 2024, Grayscale listed the Grayscale Ethereum Mini Trust as a cheaper alternative to their flagship product, ETHE. However, despite this development, ETHE still charges management fees of 1.5%, which may have contributed to its significant outflows in 2024.
A Possible Shift in the Balance
Since November, ETH has consistently outperformed BTC in crypto spot and derivatives markets, according to a December report by Bybit. This trend suggests that Ethereum-based ETFs may finally gain ground on their Bitcoin counterparts in the coming year. As Matt Hougan, Bitwise’s head of research, told Cointelegraph:
"Ethereum and Base, an Ethereum layer-2 scaling network, are ‘where many AI agents are currently operating’. This sustained growth in network activity could further propel Ether’s performance, which has lagged behind rival layer-1 network Solana in 2024."
VanEck Estimates ETH Price to Reach $6,000 by Q4 2025
Asset manager VanEck estimates that Ether’s spot price will reach $6,000 by the fourth quarter of 2025. While this prediction may be optimistic, it highlights the growing optimism among investors and analysts regarding Ethereum’s potential.
Conclusion
The surge in net inflows for Ethereum ETFs in December marks a significant milestone for the cryptocurrency market. As investor interest continues to grow, it will be fascinating to see whether Ether-based ETFs can finally overtake their Bitcoin counterparts in the coming year. With sustained growth in network activity and improving price performance, the prospects look promising for ETH-based ETFs.
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