Ethereum futures ETFs receive lukewarm response on first day of trading
Ethereum futures exchange-traded funds (ETFs) made their much-anticipated debut recently, but the initial response has been rather underwhelming in terms of investment interest. On October 2nd, a total of nine new ETF products were introduced to the market. These ETFs are designed to track futures contracts associated with Ethereum’s native cryptocurrency, Ether (ETH). Out of the nine funds, five exclusively focus on Ether futures, while the remaining four include a combination of Bitcoin (BTC) and ETH futures contracts.
Senior Bloomberg ETF analyst Eric Balchunas expressed his disappointment with the lackluster trading volume on the launch day. He took to X (formerly Twitter) to share his thoughts, stating, “Pretty meh day of volume.” The nine ETFs collectively witnessed less than $2 million in trading volume by midday Eastern Time.
Among the various futures ETF products, Valkyrie’s Bitcoin Strategy ETF emerged as the most popular, accumulating a total trading volume of $882,000. It’s worth mentioning that this ETF had already been trading exclusively as a Bitcoin futures ETF since October 2021, but it recently adjusted its strategy to include ETH.
The trading volume of Ether ETFs on their first day paled in comparison to that of ProShares Bitcoin Strategy ETF, which was launched in October 2021 during a booming cryptocurrency market. The ProShares ETF amassed over $1 billion in trading volume on its first day.
The Impact of Spot ETF Preference
In comparison to traditional finance ETF launches, the trading volume witnessed by the Ethereum futures ETFs was considered substantial by Balchunas. However, he emphasized that investors generally prefer spot ETF products over futures.
According to Balchunas, the simultaneous launch of all the ETF products was strategically planned by the Securities and Exchange Commission (SEC) to prevent any single fund from monopolizing the market.
Notable Absence in the Market
While several United States firms contended for a leading position in the emerging Ether futures market, ETF firm Volatility Shares opted not to list a similar product. They justified their decision by stating that they didn’t perceive a favorable opportunity at the current time.
In conclusion, the first day of trading for Ethereum futures ETFs didn’t live up to the initial hype. Despite the lukewarm reception, the trading volume was still considered notable. It remains to be seen how these ETFs will perform in the long run and whether investor interest will pick up in the future.
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