The US Securities and Exchange Commission’s continued delay in approving spot Ethereum exchange-traded funds (ETFs) for trading resulted in Ethereum ETFs recording their most significant outflows in two years.

According to CoinShares‘ latest digital asset fund report, these outflows resulted in a third consecutive week of negative flows of $30 million for global crypto-related investment products.

However, James Butterfill, Coinshares head of research, noted that last week’s modest flow suggested “a significant stemming of the outflows.”

Meanwhile, the negative sentiment had little impact on the trading volume of these products, which rose by 43% week-on-week to $6.2 billion. However, this is still significantly lower than the weekly average of $14.2 billion.

Ethereum sees highest outflows in 2 years

Ethereum outflows reached $61 million last week, the highest since August 2022. Over the past two weeks, ETH outflows have totaled $119 million, making it the worst-performing asset on the year-to-date metric, with a negative net flow of $25 million.

Butterfill attributed the outflows to investors’ negative sentiment surrounding the current uncertainty about when Ethereum ETF products would start trading. On June 28, Bloomberg ETF analyst Eric Balchunas noted that the approval of the financial instruments could be further delayed until the week of July 8 because the SEC and some applicants were still tidying documents.

Bitcoin benefited from this shift in sentiment, with inflows totaling $10 million last week. The CoinShares report noted that most Bitcoin ETF providers, including BlackRock’s IBIT and Fidelity’s FBTC, recorded modest inflows, partially offsetting the $153 million outflow from Grayscale’s GBTC fund.

The positive sentiment also led to $4.2 million in outflows from Short-Bitcoin positions. Moreover, market observers noted that BTC’s price struggles might have attracted significant attention from these bearish traders.

Large-cap alternative digital assets like Solana and Litecoin also saw minor inflows of $1.6 million and $1.4 million, respectively. Meanwhile, Butterfill added:

“Blockchain equities, despite the positive sentiment for crypto this year, have suffered outflows of $545 million this year, representing 19% of AuM.”

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