Ethereum ETF funds outpace Bitcoin — Why is the demand for ETH skyrocketing?

Over the past week, Ethereum ETF funds have surpassed Bitcoin in attracting investment flows.

According to the asset management company Farside Investors in the UK, nine Ethereum ETF funds have attracted over 1.8 billion USD in net inflows just this week, marking a streak of 16 consecutive days of growth. Meanwhile, 12 Bitcoin ETF funds only recorded an additional approximately 70 million USD during the same period, with three out of five trading sessions witnessing net outflows.

Source: Farside Investors "Most investors now own Bitcoin ETFs and are increasingly interested in diversifying their portfolios," Ric Edelman, founder of the Digital Assets Council for Financial Professionals, shared with Decrypt. "Ethereum is the second-largest digital asset and is currently the only coin besides Bitcoin with a spot ETF – making the choice easier for those looking to expand their portfolios."

The surge of Ethereum ETF funds coincides with the strong increase in ETH prices and the growing popularity of Ethereum treasury funds. These trends are further driven by the GENIUS Act – which was recently signed into law by President Donald Trump last week – and is expected to bring numerous benefits to Ethereum, capturing 51% of the stablecoin market.

Currently, the price of Ethereum is trading around 3,745 USD, down about 3% from the 7-month peak set earlier this week, but still up more than 50% over the past month.

"Ethereum has had an impressive price surge after a long period of underperformance compared to Bitcoin. And as usual, investors tend to buy after prices have risen sharply and sell when prices drop – completely contrary to investment theory," Edelman further commented.

Leading the wave of investment into ETH ETFs this week is BlackRock's iShares Ethereum Trust (ETHA), attracting $1.29 billion. According to data from Bloomberg, ETHA has also just become the third fastest ETF to reach $10 billion in assets under management in the 32-year history of the ETF industry – just 251 days after its launch. The Fidelity Ethereum Fund (FETH) also recorded over $380 million in inflows, bringing its total assets under management to $2.3 billion.

Mr. Juan Leon – a senior investment strategist at the ETF issuer Bitwise Asset Management – stated that the surge of ETH ETF funds this week is the pinnacle of a month of strong growth compared to BTC ETF funds.

"The inflow of funds into Ethereum ETFs is rapidly closing the gap with Bitcoin," Leon stated. "For example, in the first week of July, although the market cap of ETH is 5 times smaller than that of BTC, the ETF capital only differs by about 3.5 times. The following week, the gap continued to narrow, and by last week it was almost equal."

Although believing that the ETH ETF will maintain momentum in the short term, Leon thinks that investors may return to Bitcoin ETFs in the second half of the year – when major trading platforms like Merrill Lynch and Wells Fargo launch Bitcoin ETFs before officially opening sales for the Ethereum ETF.

"That will drive the flow of money back to the Bitcoin ETF," he said. "So I'm not sure the ETH ETF will continue to outperform the BTC ETF for the rest of the year. But right now, Ethereum is at a short-term breakout point. In terms of asset scale ratio, ETH is still 'punching above its weight' and is likely to continue doing so in the coming weeks or months."

Thạch Sanh