BlackRock named the reason ETH ETFs are less popular compared to bitcoin peers

According to a senior investment company executive, the native token of the Ethereum blockchain is a less understood asset for clients

01.10.2024 - 13:30

2 min

What’s new? BlackRock, a major investment firm, has admitted that the performance of its Ethereum-based spot exchange-traded fund (ETH) is significantly underperforming compared to its similar bitcoin ETF. According to Robert Mitchnick, the head of digital assets, this situation will not change anytime soon.

Material by Fortune

What else is known? Spot exchange-traded bitcoin fund BlackRock under the ticker IBIT was launched on the US stock exchange Nasdaq on January 11. It is currently the segment leader in terms of both fund inflows and assets under management (AUM) with $21,5 billion and $23,23 billion, respectively.

BlackRock’s spot ETH ETF under the ticker ETHA began trading on Nasdaq on July 23. It now leads in fund inflows ($1,15 billion) but is in third place in AUM ($1 billion), behind Grayscale’s ETHE fund, which launched a few years earlier, and Grayscale’s ETH Mini Trust.

While recognizing the significant difference in performance, Mitchnick still urged the audience to compare ETHA to the crypto fund segment as a whole:

“It’s very rare that you see an ETF get to a billion AUM in seven weeks, as ETHA did. In most cases, it takes multiple years to never for a new ETF to get to a billion.”

For comparison, IBIT collected $2 billion worth of bitcoins under management within 15 days after its launch.

The senior executive of BlackRock also noted that ETH is a less clear asset for investors, and for this reason, the flow of funds into ETH funds will not be comparable to that of BTC funds in the near future. At the same time, the manager added that the company is committed to educating clients in this area.