Ethereum Futures ETFS Debut With Muted Demand on CBOE

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On Monday, nine Ethereum futures exchange-traded funds (ETFs) began trading on the Chicago Board Options Exchange (CBOE), marking the first time such products have been available in the United States. However, demand for these offerings was reportedly lower than for the ProShares Bitcoin Strategy ETF launch in 2021.

Investment firms ProShares, VanEck, Bitwise, Valkyrie, Kelly, and Volshares collectively debuted these ETFs. Among them, ProShares introduced three funds: the Ether Strategy Fund (EETH), the Bitcoin and Ether Strategy ETF (BETH), and the Bitcoin and Ether Equal Strategy ETF (BETE).

Bitwise launched its Bitwise Ethereum Strategy ETF (AETH) and Bitwise Bitcoin and Ether Equal Weight Strategy ETF (BTOP). Meanwhile, VanEck's Ethereum Strategy ETF (EFUT) also started trading alongside Valkyrie's Bitcoin and Ether Strategy ETF (BTF), while Volshares rolled out its Ether Strategy ETF (ETHU). Brazilian fund manager Hashdex also introduced its Ether Strategy ETF (EX).

Despite this variety of offerings, trading volumes were low at the start, with just under $2 million in total traded by 11:25am ET as per Bloomberg Intelligence analyst Eric Balchunas. Valkyrie's BTF led the pack with around $787,000 worth of shares traded by that time.

These newly launched funds track the future price of Ethereum rather than the asset itself. This comes as investors anticipate a spot crypto ETF which lets investors gain exposure to the cryptocurrency at its current price, without holding the actual asset.

In addition to these launches, Grayscale is seeking to convert its Ethereum Trust into a spot Ethereum ETF following its earlier efforts to do the same with its Bitcoin product. NYSE Arca has filed a 19b-4 form with the Securities and Exchange Commission (SEC) to facilitate this conversion.

VanEck's ETF, listed under the ticker EFUT, is set to gain capital through investments in ether futures contracts. It will offer exposure to cash-settled ETH futures contracts traded on CFTC-regulated commodities exchanges. The firm has also highlighted tax benefits for long investors due to the product's C-Corp structure.

In an interesting move, VanEck has pledged to donate 10% of all profits from its Ether futures ETF to Ethereum's core developers over the next decade. The firm had been promoting the launch of its ETF on social media platforms with "Enter the Ether"-themed commercials.

As of Monday, CoinGecko listed the price of Ethereum at $1,690, marking a 24-hour rise of just 0.5% and a nearly 7% increase over the past week.

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