Ethereum ETF Records $65 Million Inflow – Why Are Institutional Investors Betting on ETH?

5/29/2025, 3:48:07 AM
On May 21, 2025, the Ethereum ETF recorded a net inflow of $65 million in a single day, attracting institutional attention to the ETH market. This article analyzes the logic of capital flow and provides operating suggestions for beginners.

ETH ETF Latest Inflow Overview

According to SoSoValue data, on May 21, 2025, Ethereum-related exchange-traded funds (ETFs) recorded a net inflow of $65 million in a single day, demonstrating strong capital involvement momentum. This figure not only marks a new high for the past week but also indicates that market sentiment towards Ethereum is shifting from cautious to positive.

It is particularly noteworthy that on the same day, the total net inflow of Bitcoin ETFs reached 329 million USD, of which BlackRock’s IBIT accounted for 287 million USD. This shows that institutional funds are not only increasing their positions in BTC but are also beginning to pay attention to ETH as a “second choice” or “technological growth asset”.

The net inflows of the ETH ETF are mainly concentrated in the following products:

  • Grayscale Ethereum Trust (ETHE): As the largest ETH investment trust currently, although it is still trading at a discount, market buying pressure is strong.
  • ProShares Ether Strategy ETF (EETH): Based on futures contracts, favored by institutions;
  • Bitwise Ethereum Strategy ETF (AETH): Combines strategy with spot exposure, attracting attention from compliant funds.

This round of inflows indicates that Ethereum is regaining market attention, especially against the backdrop of BTC nearing historical highs and a slowdown in return expectations.

Ethereum daily price performance


Image:https://www.gate.com/trade/ETH_USDT

The price performance of ETH today (May 29, 2025) is as follows:

The opening price today is $2,670, showing strong early buying pressure, with a maximum intraday high of $2,790, once again testing the key resistance level above. In the past 24 hours, the trading volume was approximately $1.92 billion, indicating active capital flow. CryptoRank points out that the current short-term resistance still focuses on the $2,700–$2,800 range.

Overall, the ETH market is strong today, with prices maintaining a fluctuating upward trend within the range of 2,700–2,800 USD.

The layout logic of institutional investors

1. Demand for diversified asset allocation
As Bitcoin approaches its previous highs, some institutions are turning their attention to the more technologically promising Ethereum. As the foundational layer for Web3 applications, ETH is seen as a growth-oriented technology asset, expected to outperform BTC in the next bull market.

2. Long-term value of upgrading drivers
The Ethereum network is on the eve of the “Electra (Pectra)” upgrade, with proposals such as EIP-7702 and EIP-3074 further optimizing wallet interaction experience and enhancing contract functionality. Technical upgrades are often an important factor driving early capital positioning.

3. Stable inflation rate and yield mechanism
Since Ethereum transitioned to Proof-of-Stake (PoS) in 2022, its monetary policy has become more stable, and staking ETH can yield stable returns (annualized 3%-5%). For institutional investors with moderate risk tolerance, the risk-reward ratio of ETH is more favorable.

Why are retail investors still waiting?

Despite the increased involvement from institutions, data from Google Trends, DEX activity, and retail buying on trading platforms indicate that retail investors have not yet fully entered the market. Reasons include:

  • Market confidence has not fully recovered: After experiencing the bear market of 2022-2023, some retail funds are still waiting for confirmation signals;
  • Lack of information channels: retail investors find it difficult to timely understand professional information such as ETF filings and capital flows;
  • Short-term trading atmosphere is strong: some retail investors still prefer short-term speculative assets like Memecoin and GameFi, showing insufficient attention to ETH.

This also means that the current rise in ETH is more of a “clean rally,” and once retail investors enter the market, the price is expected to accelerate upward.

Action advice for investment beginners

For novice users who want to participate in Ethereum investment, the following points are particularly important:

1. Prioritize learning basic concepts
Understanding the functions of Ethereum, Layer 2 architecture, staking mechanisms, and the relationship between DeFi and NFTs will help you grasp its long-term value.

2. Adopt a dollar-cost averaging strategy
Dollar-cost averaging (DCA) is an effective investment method to smooth out costs and avoid the risks of short-term fluctuations. You can choose to regularly buy ETH weekly or monthly to avoid chasing highs and selling lows.

3. Pay attention to on-chain data and ETF application dynamics
Using tools like CoinGlass, LookIntoBitcoin, Santiment, etc. to track fund flows, whale address changes, etc. can help to identify market turning points in advance.

4. Emphasize Security and Platform Selection
Choose compliant and liquid platforms for trading or staking operations to avoid being constrained by centralized risks or asset freezes.

5. Set up take profit and stop loss plan
Set clear take-profit and stop-loss points for each investment to avoid unnecessary losses caused by emotional trading.

Conclusion

Ethereum, as the operating system of the Web3 world, is regaining mainstream capital market recognition through ETF inflows. Currently, institutions are taking the lead while retail investors are observing, providing investors with a “window of opportunity”. For newcomers, a solid understanding of the market and adherence to long-termism will be key to navigating through cycles.

In the coming months, if the ETH ETF is approved as a spot product and the ETH/BTC ratio rebounds from the bottom, it may become an important catalyst for driving Ethereum to emerge from an independent market.

Author: Max
* The information is not intended to be and does not constitute financial advice or any other recommendation of any sort offered or endorsed by Gate.
* This article may not be reproduced, transmitted or copied without referencing Gate. Contravention is an infringement of Copyright Act and may be subject to legal action.

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