Ether exchange-traded funds (ETFs) are gaining momentum, with analysts forecasting significant inflows in 2025. Strong price performance and the potential for staking yields could drive Ether ETF growth, potentially surpassing Bitcoin ETF inflows.
As of December 16, Ether ETFs have recorded seven consecutive weeks of net inflows, including a record-breaking $2.2 billion during the week of November 26, according to data from CoinShares. This trend is expected to continue, especially if spot ETH price gains enhance returns and regulators allow staking yields for ETFs.
“Net inflows into ETH ETFs are currently on pace with gold ETFs, but I expect inflows to accelerate from here,” said Nate Geraci, president of The ETF Store, in a December 20 post on the X platform.
Ether Outperforming Bitcoin
Ether has outperformed Bitcoin in both spot and derivatives markets since November, according to a December report from Bybit. Meanwhile, Bitcoin ETFs experienced their largest-ever net outflows on December 19, highlighting the shifting investor preference toward ETH.
The Ethereum network’s growing activity, driven partly by the increasing use of artificial intelligence (AI) agents, could further bolster Ether’s performance. “Many AI agents are operating within the Ethereum ecosystem, despite assumptions that it’s all happening on Solana,” said Matt Hougan, head of research at Bitwise, in a December 19 interview.
Asset manager VanEck projects Ether’s spot price could reach $6,000 by late 2025 and as high as $22,000 by 2030, supported by Ethereum’s potential to generate up to $66 billion in annual free cash flow.
Staking Yields Could Boost Ether ETFs
The addition of staking features to U.S.-based Ether ETFs may also accelerate inflows. Staking involves locking up ETH as collateral on the Ethereum network, earning rewards from network fees and other payouts. As of December 20, Ether staking offers an annualized percentage return (APR) of around 3.35%, according to Staking Rewards.
“ETH staking is a reasonable bet to be investigated and potentially applied in the ETF space,” Hougan noted.
In a related move, the U.S. Securities and Exchange Commission recently approved two ETFs comprising a market-weighted index of Bitcoin and Ether. Analysts believe this development could open additional avenues for Ether fund inflows.
Looking Ahead
With strong price performance, expanding network activity, and the possibility of staking rewards, Ether ETFs are well-positioned to capitalize on growing investor interest. As the crypto ecosystem evolves, Ethereum’s robust fundamentals and increasing adoption may set the stage for Ether ETFs to outshine their Bitcoin counterparts in the year ahead.
Featured image from: blockworks.com