Bitcoin & Ethereum Diverge—ETF Flows Just Flipped The Narrative

Keshav Verma

1 month ago

2 mins read

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Data shows the demand for spot exchange-traded funds (ETFs) has cooled off for Bitcoin, while Ethereum has continued to attract inflows.

Bitcoin Has Ended A Streak Of Positive ETF Flows

In a new thread on X, the on-chain analytics firm Glassnode has talked about how the total balance of the US spot ETFs has changed for Bitcoin and Ethereum recently. The spot ETFs refer to investment vehicles that provide an alternate means of gaining exposure to a cryptocurrency’s price movements in a manner that’s familiar to traditional investors.

These ETFs are a relatively new presence in the sector, but they have gained sufficient popularity to become a key part of the market. Investors who previously avoided digital assets due to the perceived complexity of wallets and exchanges can now invest through ETFs, which trade on traditional exchanges.

The US Securities and Exchange Commission (SEC) approved the spot ETFs for Bitcoin back in January 2024. They got approval for Ethereum half a year later, in July 2024.

First, here is how the balance held by the spot ETFs has changed for Ethereum since their inauguration:

Ethereum ETF Balance — Looks like the ETH spot ETFs have been getting positive netflows recently | Source: Glassnode on X

As displayed in the above graph, the total balance of the Ethereum spot ETFs has been on the rise recently. In fact, the cryptocurrency has now seen four straight weeks of net inflows.

In all, 97,800 ETH have entered into the wallets associated with these ETFs during this green netflow streak. Though despite the continuous inflows, their total holdings are yet to hit the 3.81 million ETH peak from February, as they currently sit at 3.77 million ETH, about 41,000 tokens lower. “Accumulation is steady, but room remains for further upside,” notes Glassnode.

Bitcoin has also seen growth in its spot ETF holdings recently, but unlike Ethereum, the number one digital asset saw the metric surpass its high from February last month.

Bitcoin ETF Balance — The trend in the BTC balance held by the US spot ETFs | Source: Glassnode on X

That said, while the Bitcoin spot ETFs were enjoying inflows until very recently, the trend has changed during the past week as net outflows have occurred instead. This has been the first negative week in eight for the BTC ETFs.

“Total holdings are now 1.20M BTC, down ~11.5K BTC from the late-May peak,” explains the analytics firm. “A pause in demand after a strong run-up – watch for signs of re-acceleration.”

It now remains to be seen how things will develop in the coming days for the top two cryptocurrencies and whether the divergence that is starting to develop between them will only take further hold.

BTC Price

Bitcoin has seen a jump of about 2% during the past day and has recovered to $107,600.

Bitcoin Price Chart — The price of the coin appears to have been making recovery recently | Source: BTCUSDT on TradingView

Featured image from Dall-E, Glassnode.com, chart from TradingView.com

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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