On December 23, US spot Bitcoin (BTC) exchange-traded funds (ETFs) had significant outflows of $226 million, while Ethereum ETFs saw inflows of $130 million. The huge difference in net flows between these two ETFs has sparked discussions among crypto analysts about whether altcoin season may be near.
Capital Flow Pivots From Bitcoin ETFs to Ethereum ETFs
Bitcoin ETFs have been experiencing massive outflows since December 19, with total outflows exceeding $1.1 billion at the time of writing. Notably, this trend comes after 15 consecutive trading days, in which the total assets of Bitcoin ETFs rose from $100 billion to $121 billion.
On December 19 alone, Bitcoin ETFs recorded $680 million in inflows – the largest single-day outflow since the launch of Bitcoin ETFs earlier this year – bringing their total assets down to $105 billion. A key contributor to this decline was Greyscale’s GBTC fund, which sold 1,870 BTC over a three-day period.
While some market analysts say the recent exit is related to profit taking, others believe the trend may reflect a change in investor sentiment towards the leading cryptocurrency. Specifically, it appears that there may be a significant return of funds from Bitcoin ETFs to Ethereum ETFs.
Supporting this view, the Ethereum ETF has been attracting increasing interest, as seen in the latest entry data. In accordance with calculations from SoSoValue, Ethereum ETFs received $130 million in inflows on December 23, the same day Bitcoin ETFs reported $226 million in outflows.
The increase in income in the Ethereum ETF is not unexpected, as institutional interest in the second largest cryptocurrency by market cap continues to grow. The latest report BlackRock’s iShares Ethereum Trust ETF has raised more than a million ETH.
Bullish Sentiment For Ethereum Is Growing
Although Ethereum has underperformed relative to other cryptocurrencies such as Solana (SOL), SUI, and XRP for most of the year, analysts believe that the tide may be turning in ETH’s favor. One of the main reasons for this hope is going down The dominance of Bitcoin, which many see as the precursor to the long-awaited “altcoin season”.
In addition, bullish technical indicators are fueling positive The price of Ethereum today. For example, the ETH/BTC trading pair posted a record high low on December 22 on the daily chart, indicating a possible trend reversal and potential gains for ETH.
In addition, weekly net inflows into Ethereum staking contracts were in place wake upsuggesting that more ETH is locked in the stake. This reduction in circulating supply can create upward pressure on the price of Ethereum.
That said, veteran crypto analyst Ali Martinez it is waiting The next rise of Ethereum will be delayed a bit. At press time, ETH is trading at $3,363, down 2.7% in the last 24 hours.
Featured image from Unsplash.com, Charts from TradingView.com
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