Glassnode: The average unrealized loss of ETH ETF investors has reached 21%

What’s new? The majority of investors in US spot exchange-traded funds (ETFs) based on the Ethereum token from asset managers BlackRock and Fidelity Investments are suffering significant losses, according to crypto analytics firm Glassnode. “The average investor in the BlackRock and Fidelity Ethereum ETFs are now substantially underwater on their position, holding an unrealized loss of approximately -21% on average,” Glassnode said in a May 29 report.

Analysts’ report

What else is known? According to data from aggregator CoinMarketCap, Ethereum is currently trading at $2600. However, the BlackRock fund has a base value of $3300 for the asset, and Fidelity has an even higher value of $3500.

ETH last traded above $3000 on February 2 and then entered a downtrend when US President Donald Trump signed an executive order imposing import duties on goods from China, Canada, and Mexico.

ETH hit a one-year low of $1472 on April 9 when the duties went into effect. However, the asset has surged 44% over the past month, and spot funds based on it have recorded nine consecutive days of inflows totaling $435,6 million since May 16.

Some analysts expect further gains in the cryptocurrency market, as a US federal court blocked most of Trump’s duties on May 28.

Since the ETH ETF launched in the US on July 23, 2024, they have recorded total inflows of $2,94 billion. Ethereum was trading at around $3536 on the launch day.

Glassnode analysts suggested that the launch of the funds did not have a significant impact on the price of the underlying asset: “The Ethereum ETFs initially accounted for just ±1.5% of the trade volume in spot markets, suggesting a relatively lukewarm reception on launch.”

By November 2024, that share had grown above 2,5%, coinciding with Trump’s victory in the presidential election. The victory kicked off a massive month-long crypto market rally that saw Ethereum reach $4007 on December 8.

At the same time, the company specified that since then, the share of spot funds in the total spot trading volume of the largest altcoin has fallen again to 1,5%.

Grayscale: ETH-based spot funds lost $61 million due to the staking ban

The company asked the SEC’s cryptocurrency task force to allow asset staking on behalf of investors

Read more

At the Digital Asset Summit on March 20, BlackRock’s head of digital assets Robbie Mitchnik noted that the Ether spot ETF is “less perfect” without staking.

Securities regulator SEC did not allow fund issuers to put coins purchased on behalf of investors into staking, which deprived them of the opportunity to earn extra income. After the change in SEC leadership, some companies are trying to get permission for staking as the regulator has taken a friendlier stance on cryptocurrencies.