The launch of Ethereum (ETH-USD) ETFs has sparked a significant sell-off, revealing troubling shifts in the crypto market. According to 10x Research, the anticipated boom quickly fizzled as market dynamics shifted dramatically. Markus Thielen, founder of 10x Research, explained to CoinTelegraph that traders “anticipated Ethereum ETFs would capture 20% of Bitcoin ETF inflows.” However, they underestimated the impact of “billion-dollar outflows from Grayscale” and the common “sell the news” reaction.
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Grayscale’s Heavy Losses
Grayscale’s $9 billion Ethereum Trust suffered a staggering $481 million outflow on its first day, with losses continuing at $326 million on the following day. Meanwhile, Bitwise’s ETFs saw $204 million in inflows, largely due to Pantera Capital. However, Pantera’s quick sell-off of its investment hints at skepticism about long-term growth.
Ethereum’s Struggles Compared to Bitcoin
The latest 10x Research report also highlights Ethereum’s struggles relative to Bitcoin (BTC-USD). “Ethereum might be the weakest link, where fundamentals (new users, revenues, etc.) have been stagnant or lower,” the report explains. As Ethereum’s price falls nearly 8% to around $3,181, the market is unsettled. Unlike Bitcoin, which enjoys the status of “digital gold,” Ethereum lacks a clear and compelling value proposition in the eyes of Wall Street traders.
Shift Towards Solana?
Further complicating matters, the report points to a growing interest in Solana (SOL-USD) as memecoin activity shifts away from Ethereum. With additional factors like Mt. Gox distributions and a historically weak August and September, investors should prepare for potential further declines.
What Is the Price of ETH?
At the time of writing, ETH is priced at $3,140.79, reflecting a 10% decline over the past five days.
