The Ethereum ETF achieved a new record with a market capitalization of USD 1.019 billion in just one day, led by BlackRock, contributing to ETH's strong breakout in the market.
The new wave of investment into Ethereum ETFs not only sets a historical milestone but also helps the price of ETH soar, attracting global attention and boosting expectations for a fresh wind of innovation in the cryptocurrency market.
MAIN CONTENT
The Ethereum ETF led by BlackRock has recorded USD 1.019 billion in capital in just one day, setting a new record.
The performance of ETH outperformed Bitcoin, with a price increase of over 19% in the week, raising hopes for a new ATH.
Vitalik Buterin shared the long-term development roadmap of Ethereum, alongside unexpected moves from BlackRock on the blockchain.
What is Ethereum ETF?
Ethereum ETF is an exchange-traded fund that simulates the price of Ethereum, allowing investors to access ETH through the stock exchange without needing to own this coin directly.
Ethereum ETF helps bring ETH to many institutional and individual investors, providing transparency, security, and reducing custody risks. Especially, after the U.S. approved spot ETFs, the influx of capital has been continuously increasing, creating a strong investment wave on Wall Street. According to Farside's report, these products have boosted liquidity while elevating Ethereum's recognition in traditional finance.
Why did the market capitalization of the Ethereum ETF surge on August 11?
On August 11, the Ethereum ETF attracted a record capital flow of USD 1.019 billion, with BlackRock leading the charge, boosting the price and market sentiment for ETH.
The surge in capital flow originates from BlackRock’s iShares Ethereum Trust (ETHA) – a product that attracted over USD 640.68 million in just one day. The significant increase in capital indicates institutional investors' confidence in ETH's long-term price increase potential, despite Bitcoin's sideways market. Since the low point in April, the value of this ETF has increased nearly 200%, demonstrating Ethereum's appeal in the wave of DeFi, NFT, and Web3 infrastructure innovations.
"The extraordinary growth trend in the Ethereum ETF not only demonstrates the strong appeal of ETH but also showcases BlackRock's pioneering role in leading the digital financial trend."
Analysis from CoinMarketCap, August 2024
How did BlackRock's ETHA set a historical record?
On August 11, BlackRock’s ETHA recorded the largest purchase volume since its launch, with trading value and stock price reaching an all-time high.
ETHA attracted 149,168 ETH, worth USD 640.68 million, setting a record for capital flow in a single day. Daily trading volume skyrocketed to USD 1.8 billion, reflecting the wave of participation from financial institutions. ETHA's stock price surged to USD 33.02, up 5% in just one day, and compared to the previous month, the total ETF value increased by 41%. The strong capital flow in June and July set the stage for ETH to surpass the market, even as Bitcoin's price fell below USD 120,000 at the same time.
"The continuous accumulation of ETH by large investors has raised the ETF to a new price level and created a ripple effect across the entire digital asset market."
Market analysis report, Farside, August 2024
How do the performances of ETH and BTC compare recently?
Last week, ETH recorded an increase of over 19%, far surpassing Bitcoin's mere 4% increase, laying the foundation for hopes of conquering a new historical peak.
While ETH's price surpassed USD 4,279.18 (up 2.18% in 24h, according to CoinMarketCap) and continues to break through, Bitcoin slightly dropped by 1.18%, stabilizing around USD 118,293.89. This divergence is due to the wave of Ethereum accumulation, attracting institutional investors thanks to the ETF capitalization effect and the platform's innovation expectations. The trend of capital shifting from Bitcoin to Ethereum is becoming increasingly evident in international financial forums, as ETH shows greater potential growth capability due to technological advancements and support from large funds.
Ethereum Index (ETH) Bitcoin (BTC) Weekly increase 19% 4% Current price (according to CoinMarketCap, 11/8/2024) USD 4,279.18 USD 118,293.89 ETF capital flow trends Strong increase, setting a record Slight fluctuations, not prominent
"Ethereum's dominance over Bitcoin during this period demonstrates that investors prioritize innovation and growth rates over traditional stability."
Farside's in-depth report, August 2024
What is the new development roadmap of Ethereum through Vitalik Buterin's sharing?
Vitalik Buterin emphasizes the development goal of Ethereum with ultra-light nodes, privacy security, easy self-management of assets, and the standardization of the entire ecosystem from DApps to hardware.
Last week, Vitalik Buterin outlined a vision for Ethereum's future aimed at standardizing decentralized safety across all social platforms, moving towards a Trustless system (no need to place blind trust in third parties). He believes that the old 'trust me' systems will become outdated like drinking unfiltered tap water. This vision prioritizes user experience, security, and personal asset control, helping Ethereum lead the trend of digital asset technology.
"The direction of Ethereum is to eliminate trust barriers, bringing automatic security and transparency into every corner of the digital social space."
Vitalik Buterin, Ethereum Founder, August 2024, according to X (Twitter)
What does BlackRock's movement on the blockchain mean?
On August 5, BlackRock was noted by Arkham Intelligence to have transferred 2,544 BTC and 101,975 ETH from ETF holdings to Coinbase Prime, causing much speculation about the meaning of this move.
The large digital currency transfer raised debates about whether this is a routine activity or a strategic portfolio adjustment by BlackRock in response to new market developments, especially when the market witnessed huge capital inflows into the ETH ETF. A significant interest from institutional investors towards both Bitcoin and Ethereum continues to nurture expectations about a diversified and more competitive digital asset landscape in the near future.
How does the Ethereum ETF affect the cryptocurrency market?
The explosion of the Ethereum ETF increases liquidity, diversifies investment options, and solidifies ETH's position in the global digital asset market.
The ETF facilitates large capital flows from funds, institutions, and professional investors into the market transparently and legally. This helps reduce volatility, enhance reliability, and accelerate the adoption of Ethereum on an international scale. Experts believe that the ETF effect on ETH is even greater than that on Bitcoin due to Ethereum's technological foundation and its strong application scalability in areas such as DeFi, NFTs, AI Blockchain, etc.
Frequently Asked Questions
How is Ethereum ETF different from buying ETH directly on exchanges?
Ethereum ETF allows investors to access ETH through a fund product on the stock exchange without having to manage wallets or lock Private Keys, making it convenient for institutional investors under U.S. legal standards.
What impact does BlackRock's continuous buying of ETH through the ETF have?
Large-scale buying activity from BlackRock boosts market confidence, creates a ripple effect of capital flow, and enhances the market capitalization value for ETH.
Does the price of ETH get affected by ETF fluctuations?
Yes, the inflow/outflow of capital from the ETF strongly affects the demand and supply for ETH from institutions, contributing to increased liquidity and directly impacting prices in the market.
Why has ETH risen faster than Bitcoin in recent times?
ETH benefits from the ETF effect, along with new technological vision and strong accumulation from institutional investors, surpassing the limited growth of Bitcoin in the same period.
What is BlackRock's purpose in transferring ETH and BTC to Coinbase Prime?
It could be a portfolio restructuring move or a liquidity event for the ETF assets, but there has been no official confirmation from BlackRock.
How to track ETH ETF capital flows?
Investors can continuously update through reputable financial data sites like Farside or CoinMarketCap to capture the latest fluctuations of Ethereum ETF capital flows.
Will ETH reach a new ATH this year?
With the ETF capital momentum and technological innovation, many experts believe ETH has the potential to reach a new ATH if it maintains this momentum, but market risks still exist.
Source: https://tintucbitcoin.com/eth-etf-thu-hut-1-ty-usd/
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