Bitcoin ETFs See $1.2B Inflow as CBOE Sets Ethereum ETF Launch Date

Spot Bitcoin ETFs have racked up around $1.24 billion in inflows over the past week as spot markets recover.

Preliminary figures from Farside Investors suggest that Friday, July 19, saw inflows of $384 million, with Fidelity leading the pack at $140 million inflows.

This marks eleven consecutive trading days with a positive flow to these institutional investment products. Even Grayscale saw an inflow of $20 million to its GBTC spot ETF on Friday, the first positive flow day for the fund for a week.

Ethereum ETF Dates

On July 19, the CBOE announced that five spot Ethereum ETFs will begin trading on July 23, “pending regulatory effectiveness.”

The five products set to start trading next week are the 21Shares Core Ethereum ETF, Fidelity Ethereum Fund, Invesco Galaxy Ethereum ETF, VanEck Ethereum ETF, and Franklin Ethereum ETF.

Cboe new listings…

It’s happening.

Almost go time. pic.twitter.com/V1wCcxYoCH

— Nate Geraci (@NateGeraci) July 19, 2024

However, the Security and Exchange Commission has yet to officially sign off on S-1 documents for the respective funds.

Most of the issuers have stated that they will temporarily waive or discount fees to compete for market share, as reported by CryptoPotato.

Also, on July 19, Grayscale announced plans to spin off a portion of its flagship Grayscale Bitcoin Trust (GBTC) into a new ETF, the Grayscale Bitcoin Mini Trust (BTC).

The firm will allocate 10% of its spot Bitcoin ETF assets to the new fund, which is likely to have a more competitive fee structure than the 1.5% charged on GBTC.

Moreover, the firm will do the same thing when its Ethereum product is converted to a spot ETF. Existing ETHE shareholders will receive a proportional distribution of shares in its new Grayscale Ethereum Mini Trust (ETH) on July 31.

On July 19, Bloomberg ETF analyst James Seyffart said that from a value point of view, “a theoretical person has $1,000 in ETHE or GBTC. After the spinoffs occur, it should essentially be $900 in the original fund and $100 in the new mini ETFs.”

Doing a thread on the situation for @Grayscale‘s spinoff for $ETHE & $ETH because I’ve gotten about a million questions on it. The mechanics will be essentially the same for $GBTC & $BTC spinoff. If you own 1,000 shares of $ETHE, you should receive 1,000 shares of mini $ETH. 1/ pic.twitter.com/Er66mj5L46

— James Seyffart (@JSeyff) July 19, 2024

ETHE Exodus?

There are currently 271,793 BTC worth around $18.2 billion in Grayscale’s GBTC ETF and $9.2 billion in Ethereum in its yet-to-be-converted ETHE fund.

Grayscale’s crypto funds are among the longest-running in the industry, with GBTC launching in 2013 and ETHE in 2017.

There has been concern about an exodus similar to that from GBTC from ETHE when it gets converted, but distribution to the more competitive Ethereum Mini Trust should alleviate some of the outflow pressure.