NEW YORK – After a prolonged period of withdrawals, U.S. spot ether exchange-traded funds (ETFs) recorded a modest inflow of approximately $19 million on June 4, ending a 17-session streak of net outflows. This development marks a potential turning point for the second-largest cryptocurrency by market capitalization, which had suffered significant capital flight over the past three weeks.
According to data from Farside Investors, spot ether ETFs collectively lost about $900 million between May 11 and June 3. The sustained outflows had raised concerns about institutional appetite for ether, especially given that these funds rely heavily on Wall Street demand since their launch. The question now is whether this single day of inflows signals a reversal of sentiment or merely a temporary pause in the selling pressure.
Despite the positive ETF flow, ether's price continued to slide. The cryptocurrency traded near $1,662 on June 4, down approximately 6% for the day, after hitting a session low of $1,636.81. Bitcoin also weakened, falling to $62,383. Traders remained active on the sell side in the spot market, suggesting that the ETF data alone was insufficient to spark a broader market rebound.
Among the spot ether ETFs, BlackRock's iShares Ethereum Trust ETF (ETHA) was the sole fund to attract inflows on June 4, according to Farside's flow table. Other spot ether funds reported no change for the session. BlackRock's website listed ETHA's net assets at $5.06 billion as of June 4, with a sponsor fee of 0.25% and a year-to-date net asset value total return of minus 38.77% as of June 3.
The broader crypto ETF market showed only marginal improvement. U.S. spot bitcoin ETFs recorded net inflows of $3.2 million on June 4, following outflows of $396.6 million on June 3 and $519.1 million on June 2, as per Farside. This pattern hints at some easing of selling pressure across the top crypto ETF markets but falls short of indicating a full recovery.
Analysts attribute ether's recent weakness to a combination of factors beyond ETF flows. IG analyst Axel Rudolph noted in a research note earlier this week that the decline is tied to shifting ETF dynamics, inflation concerns, rising yields, and geopolitical tensions. He warned that as long as ether remains below its May 21 high, downside pressure is likely to persist. The short-term outlook, in his view, remains bearish, with traders leaning toward further declines.
Spot ether ETFs are still relatively new to U.S. markets. Reuters reported in July 2024 that the Securities and Exchange Commission approved the first exchange-traded funds tracking ether's spot price, with BlackRock, VanEck, and six other firms ready to list products on exchanges including Cboe, Nasdaq, and NYSE.
Farside's cumulative flow data reveals a wide disparity among issuers. ETHA has attracted approximately $11.3 billion in net inflows since launch, while Fidelity's FETH has gathered $2.1 billion. In contrast, Grayscale's ETHE, a converted product from an earlier trust structure, has seen about $5.3 billion in net outflows. When daily flows shift, attention remains focused on a handful of major players.
However, a single session of inflows provides limited insight. BlackRock cautions that digital assets are inherently volatile, and shares of its trust can trade at premiums or discounts to the underlying ether. The trust is not regulated as a mutual fund under the Investment Company Act of 1940, a risk that remains even after the outflow streak ended.
The coming days will be crucial in determining whether June 4 marks the beginning of a sustained inflow trend or merely a brief respite. Ether now has a more favorable ETF headline than it did a day ago, but price action has yet to follow suit.
