Spot Ethereum ETF officially begins trading! Is Grayscale selling again?

The spot Ethereum ETF officially started trading in the United States on Tuesday, which may bring the world's second largest cryptocurrency into the investment arsenal of many professional investors and advisors, marking another step towards digital assets integrating into mainstream finance.

After the spot Ethereum ETF began trading, the price of Ethereum experienced a slight decline, but quickly recovered most of the lost ground.

Haseeb Qureshi, managing partner at Dragonfly, pointed out that the opening trading volume of the spot Ethereum ETF was strong, but Ethereum's price has not shown significant changes yet. It can be speculated that this is because Grayscale's ETHE is mainly selling, which will offset a lot of the inflows on the first day.

Ethereum is the native cryptocurrency on the Ethereum blockchain. Compared to Bitcoin, which is often seen as digital gold, investing in Ethereum is more of a bet on blockchain and the broader growth of cryptocurrencies.

Jay Jacobs from BlackRock stated, "The appeal of Ethereum lies in its decentralized nature and its potential to drive digital transformation in finance and other industries."

According to FactSet data, the spot Bitcoin ETF has attracted approximately $17 billion in net inflows since its launch in January, making it one of the most successful ETF launches in history. The market expects the size of the spot Ethereum ETF to be smaller than the spot Bitcoin ETF, as many investors may not be familiar with Ethereum.

Sam Callahan, senior Bitcoin analyst at Swan Bitcoin, said, "Ethereum is still a bit confusing for individual and institutional investors."

It is worth noting that the spot Ethereum ETF does not currently support staking, a process that can provide additional income for native cryptocurrency investors.

To attract customers, many funds set to launch this week have temporarily waived fees. After the waiver, management fees range from 0.15% to 2.50%.

The cheapest and most expensive spot Ethereum ETFs are both from Grayscale, with the latter effectively converting its multi-billion dollar private Ethereum funds into two ETFs at different prices.

So far this year, the price of Ethereum has risen by over 50%, but has remained relatively flat in the past month. Unlike the market hype before the launch of the spot Bitcoin ETF in January, this cryptocurrency does not seem to have the same level of demand growth. Joel Kruger, strategist at LMAX Group, stated:

"Overall, considering the market has cooled off, there is still room for surprises in overall market sentiment, and the overall risk balance is favorable."