In a significant development for the cryptocurrency market, total net inflows into Ether Exchange-Traded Funds (ETFs) surpassed $2.6 billion in December, marking a notable milestone as these funds gain traction against their Bitcoin counterparts.
Record-Breaking Week for Ether ETFs
According to data from Farside Investors, Ether ETFs saw eight straight weeks of net inflows, including a record-breaking $2.2 billion in the week of November 26. This unprecedented surge in demand is a testament to the growing popularity of these funds among investors.
BTC ETFs Still Dominate, But Could Be Challenged
While Bitcoin ETFs continue to lead the pack, with over $35 billion in net inflows for the year, Ether ETFs are rapidly closing the gap. Analysts predict that this trend could reverse in 2025, especially if ETH’s price performance enhances ETF returns and regulators allow the funds to generate yields from staking.
Top Ether Funds Gain Traction
BlackRock’s iShares Ethereum Trust (ETHA) led among peers, onboarding upward of $3.5 billion in 2024 net inflows, according to Farside Investors. Fidelity Ethereum Fund (FETH) notched second place with $1.5 billion in net inflows.
Grayscale’s ETHE Sees Significant Net Outflows
In contrast, Grayscale’s Ethereum Trust (ETHE) saw upward of $3.6 billion in net outflows for the year. This was partly due to the asset manager listing a cheaper alternative, the Grayscale Ethereum Mini Trust, in July.
Regulatory Environment and Staking Yields
The regulatory environment is expected to play a significant role in shaping the performance of Ether ETFs in 2025. Analysts believe that if regulators allow these funds to generate yields from staking, it could significantly boost their returns and attract more investors.
Will Ether Outperform Bitcoin ETFs in 2025?
Since November, ETH has outperformed BTC in crypto spot and derivatives markets, according to a December report by Bybit. Meanwhile, BTC ETFs saw the biggest net outflows ever on December 19.
Sustained Growth in Network Activity
Sustained growth in network activity, including from the proliferation of artificial intelligence agents, could further propel Ether’s performance. Matt Hougan, Bitwise’s head of research, told Cointelegraph that Ethereum and Base, an Ethereum layer-2 scaling network, are "where many AI agents are currently operating."
Asset Manager Predicts $6,000 Price Target
VanEck estimates Ether’s spot price will reach $6,000 by the fourth quarter of 2025. This prediction highlights the potential for significant growth in the Ether market.
Conclusion
The recent surge in net inflows into Ether ETFs marks a significant milestone in the cryptocurrency market. As these funds continue to gain traction and attract more investors, it is likely that they will challenge Bitcoin ETFs in 2025. The regulatory environment and sustained growth in network activity are expected to play key roles in shaping the performance of Ether ETFs.
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