Ether Liquidity Plummets 40% On Exchanges After ETF Debut
Liquidity of Ether on US exchanges has decreased by up to 40% since the launch of spot Ether exchange-traded funds (ETFs) on July 23, 2024. The average market depth for ETH pairs has fallen to approximately $14 million, with offshore exchanges experiencing a similar decline to about $10 million. Following the introduction of nine ETFs, liquidity dropped 20% in US markets and 19% offshore. This decline raises concerns about market sensitivity to large orders, leading to increased price volatility. Ether ETFs have faced over $500 million in cumulative outflows since their launch, contributing to the liquidity decline. Grayscale’s ETHE ETF experienced an outflow of $10.7 million, while BlackRock’s ETHA ETF saw a modest inflow of $4.7 million. Ether is currently trading at around $2,258, down over 4% in the last 24 hours, with major altcoins also experiencing losses. The anticipated benefits of ETF introductions have not materialized for Ether, and future market dynamics may be influenced by potential interest rate cuts by the Federal Reserve.
