Markets
Cryptocurrency Markets Crash as Spot Ethereum ETFs Debut
Spot Ethereum ETF Launches Amid Downturn for Major Cryptocurrencies
Cryptocurrency markets plunged on Tuesday after spot Ethereum ETFs began trading.
The price of Bitcoin (BTC) dropped 0.6% over the past 24 hours to last change hands at $66,626 as of midday New York time, according to CoinGecko. Ethereum (ETH) was trading flat below $3,500. Solana (SOL) and polka dots (POINT) decreased by 1.8% and 4.3% respectively.
Ethereum ETFs have made their debut, after the U.S. Securities and Exchange Commission (SEC) green light final S-1 filings on July 22, paving the way for these ETFs to go public. The list of approved issuers includes heavyweights like BlackRock, Fidelity, 21Shares, Bitwise, Franklin Templeton, VanEck, and Invesco Galaxy.
Promising start
Bloomberg ETF analyst Eric Balchunas predicted a promising start for BlackRock’s iShares Ethereum Trust (ETHA), estimating that its trading volume could reach around $50 million within the first hour.
“Using the BlackRock ETF as a proxy, $ETHA volume after the first hour will be around $50 million,” he said. She said“If it can break above $200 million by the end of the day, it will surpass our ‘20% btc’ estimate (since $IBIT made $1 billion on day one). It looks promising, but who knows.”
Michael Van de Poppe noticed the launch of the ETF as a significant event, highlighting that in the first 15 minutes the ETH ETF managed to reach 50% of Bitcoin’s first-day volume, for a total of $112 million.
“The $ETH ETF has crazy numbers,” he said. “The first 15 minutes have already represented 50% of Bitcoin’s first day in volume: $112 million. The Ethereum ETF launch is severely undervalued and I expect it to trade near ATH in the next 1-2 months.”
Liquidations and inflows
Data from CoinGlass indicate that 55,689 traders were liquidated in the last 24 hours, with total liquidations amounting to $141 million. Bitcoin and Ethereum each accounted for $32 million in liquidations.
Crypto funds saw inflows of $1.35 billion last week, bringing total inflows over the past three weeks to $3.2 billion.
Ethereum funds have seen their largest outflows since August 2022, totaling $61 million. Over the past two weeks, outflows have reached $119 million, making Ethereum the worst-performing asset year-to-date in terms of net flows, second to CoinShares.
Mt. Gox Moves More Bitcoin
To add to the market activity, Mt. Gox resumed moving funds on July 23, moving over 47,500 Bitcoins, worth nearly $3.2 billion, to two unknown addresses.
Second According to Arkham Intelligence, Mt. Gox currently holds approximately 42,744 BTC, worth approximately $2.85 billion.
This happens after a refund declaration issued on July 5, where Mt. Gox announced plans to “promptly” repay creditors. The repayment plan calls for the distribution of over $9 billion in Bitcoin (BTC) and $73 million in Bitcoin Cash (BCH) to affected traders over the next few months.
Meanwhile, the U.S. stock market soared on Tuesday. The S&P 500, Nasdaq Composite, and Dow Jones Industrial Average each rose 0.10%.