Crypto has a lot of shared trauma. The most common feeling is the kick in the gut that comes from buying a cryptocurrency only to see it crash within minutes.
Buyers who bought ETH ETFs have been going through this right now.
The total loss on capital is estimated at $1.16 billion. They contributed the majority of their funds when the price was higher, closer to $3.300 or 27% more than what it is now.
It is important to note that the prices of ETFs are more or less correlated with the price for ETH. Losses refer to the ETH values each fund has compared with how much it cost to acquire them.
Calculation: Divide the daily US dollars flows of each ETF by the daily rate. The ETFs’ daily ETH unit purchases and sales can be roughly estimated by dividing the US dollar flows per ETF by the daily reference rate.
Then, tally those ETH units and multiply the total by the price of ETH — that will give the current value of each fund’s ETH holdings, which technically belong to their respective shareholders.
Divide the value of the ETH in each fund by the amount of US Dollars that each has received to date. This will give you an idea of how each fund is performing for its investors.
Grayscale ETFs’ performance was not calculated in this study because most of the capital transfers occurred many years ago.
21Shares’ CETH in light blue is the only ETF to be ahead of its net flows.
CETH is currently holding about $18.11 million in ETH, while its total cumulative net flows were only $16.9 million — putting it $1.21 million in the green, or nearly 7.2%.
Fidelity FETH’s FETH was the least successful of the group. The fund has $1.21bn in ETH, but it is down by $289.2m or 20%.
BlackRock’s ETHA is otherwise down 17.6%, which is slightly better performance based on percentages, but due to the size of the fund it has lost its shareholders more dollars than any other — the equivalent of $782.5 million.
Why is one fund performing better than another? When ETF clients contribute to and withdraw capital is the key factor.
Take 21Shares CETH. Take 21Shares’ CETH.
CETH holders then redeemed 15 million shares worth $15 between November and Decembre, at a time when ETH rallied around 60% since local lows, briefly clearing $4,000. CETH holders literally had purchased low and sold higher.
Anyhow, the only way to cure this problem would be if the price of Ether went up. Vitalik tweets about “making communism great again” hasn’t gone over well — might I suggest posting almost exclusively about the roadmap, as that seems to do the trick.
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