Grayscale’s Ethereum Trust Could Witness $110,000,000 in Daily Outflows if ETH ETFs Are Approved, Says Kaiko

The upcoming spot Ethereum (ETH) exchange-traded funds could initially put selling pressure on the second-largest crypto asset by market cap, according to the market intelligence firm Kaiko.

Last week, the U.S. Securities and Exchange Commission (SEC) approved the listing of spot market Ethereum ETFs, paving the way for the products to start trading on US stock exchanges.

In a new analysis, Kaiko researchers note that the approval could cause Grayscale’s Ethereum Trust (ETHE) to witness massive daily outflows. The researchers note ETHE has been trading at a discount between 6-26% in the past three months.

“ETHE currently has over $11 billion in assets under management, which makes it by far the largest ETH investment vehicle. GBTC’s outflows during the first month of trading for Bitcoin ETFs amounted to $6.5 billion, which is roughly 23% of its [assets under management] as of launch day.

Should we see a similar magnitude of outflows from ETHE, this would amount to $110 million of average daily outflows or 30% of ETH’s average daily volume on Coinbase.”

The Kaiko researchers do note, however, that inflows into other Bitcoin (BTC) ETFs offset and surpassed outflows from Grayscale’s Bitcoin Trust (GBTC) by the end of January, a few weeks after the SEC approved the BTC ETFs.

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