Ethereum ETF One Year Anniversary: From Apathy to Prosperity, Institutional Investor Confidence Significantly Increased

Three months ago, even the staunchest fans of Ethereum could hardly imagine that the U.S. Ethereum exchange-traded fund (ETF) would be celebrating its first anniversary. However, today that dream has become a reality, and the Ethereum ETF is ushering in its moment of glory—having been listed for a full year since its debut on July 23, 2024.

In June 2025, the Ethereum ETF achieved the best monthly performance in history, with inflows exceeding $3.5 billion, a 70% increase from the previous high of $2.08 billion on December 20, 2024. The inflow momentum in July is even stronger, having already surpassed $3 billion to date, and is expected to exceed June's record. The past two weeks up to July 18 have been the best two weeks for net inflows; there have been no net outflows for ten consecutive weeks, which is the first time this has occurred in its 52-week existence.

However, the development of the Ethereum ETF has not been smooth sailing.

In May 2024, U.S. regulators approved the Ethereum ETF, officially launching trading on July 23 of the same year. At that time, market reactions were mixed, as the Bitcoin ETF had already captured all the attention earlier in the year, making the debut of the Ethereum ETF seem rather uneventful: price performance was lackluster, attention gradually waned, and there was no significant influx of capital during the initial launch.

In fact, some early capital flows even showed a net outflow state. In the first 39 weeks of trading, the Ethereum ETF only achieved a net inflow of funds in 15 weeks; whereas in the past 14 weeks, 13 weeks showed a net inflow, indicating a significant shift in direction over the past three months.

As of July 21, 2025, the total assets under management (AUM) of all Ethereum ETFs in the United States have exceeded $19 billion, doubling from about $9.6 billion two months ago.

Not only ETFs, but institutional interest in Ethereum is also rapidly increasing through the form of "Ethereum reserve assets."

On June 2, 2025, a certain gaming company became the first U.S. listed company to announce that it would include Ethereum in its strategic reserves. While the crypto community was still focused on a number of publicly listed companies incorporating Bitcoin into their balance sheets, Ethereum had quietly entered the "reserve asset party."

The chairman of the board of directors of the gaming company has led the company's $425 million Ethereum strategic reserve. Since the launch of this reserve asset plan, the company has become the world's largest enterprise-level Ethereum holder, with 360,807 ETH, valued at over $1.3 billion at current prices. Additionally, the company has raised another $413 million and has earned a total of 567 ETH in rewards through staking its held Ethereum.

Another newly established company focusing on Ethereum reserve assets is also engaging in fierce competition. This Bitcoin mining company holds over 300,000 ETH, valued at over $1 billion at current prices. Its chairman is a seasoned Wall Street professional with bigger ambitions: "We are steadily advancing our goals, planning to acquire and stake 5% of the total supply of Ethereum."

Overall, the capital flows of the Ethereum Reserve Asset Company and ETFs collectively reflect the confidence of institutions in viewing Ethereum as an infrastructure layer for investment, and this confidence is continuously strengthening.

A well-known investment firm recently reduced its holdings in a certain cryptocurrency exchange and gaming company, instead increasing its stake in the aforementioned Bitcoin mining company, with an investment amounting to $182 million. The company previously had insufficient exposure to Ethereum, restructuring its investment in three flagship ETFs and allocating 1.5% of its portfolio to the mining company.

A famous investor also holds 9.1% of the company's shares.

The new company formed through the merger of existing companies will create a publicly traded platform, providing institutional investors with a professional channel to access Ethereum infrastructure and Ether returns. The company plans to be listed on Nasdaq and will hold over 400,000 ETH, worth more than $1.5 billion.

The changes that have occurred over the past few months may be related to the recent leadership changes at the Ethereum Foundation. At the end of April 2025, the Ethereum Foundation made adjustments to its leadership, separating the board from the management team. The new leadership has clarified three core priorities: expanding the Ethereum base layer, optimizing Layer 2 scaling solutions, and enhancing user experience.

The practical value and yield potential of Ethereum also make it an extremely attractive asset for investors. Currently, there are no ETFs in the United States offering staking rewards, and regulators have not yet approved them. If an Ethereum ETF can ultimately introduce staking functionality, ETH is expected to become a "digital bond" in institutional portfolios.

The supported staking ETF may provide a native yield of 3%-5%. Based on the current $19.6 billion Ethereum holdings, even at an average yield of 4%, ETF issuers could earn over $750 million in staking income.

A large asset management company is exploring product structures that include staking, as explicitly mentioned in their submitted regulatory documents, stating that staking is a "potential future function pending regulatory approval," and the market is watching closely. Experts predict that the staking feature of the Ethereum ETF is expected to be approved in the fourth quarter of this year.

For many investors, staking may be the key distinction between "shallow allocation" and "deep participation." Passive income obtained through compliant investment tools may attract pension funds, endowment funds, and sovereign wealth funds to enter the market.

If the macro environment changes, such as interest rate cuts, stabilization of inflation, or capital seeking higher returns, Ethereum will become a highly competitive choice: it combines the scarcity of supply deflation, the yield brought by staking, and the accessibility achieved through ETFs and custodial institutions.

The price of Ethereum has shown a correlation with institutional activity. A further breakthrough in price may trigger market optimism, attracting more capital inflow. In any case, after a long period of stagnation, the evolution of Ethereum will be welcomed by both retail and institutional investors.

In the past two weeks, the price of Ethereum has surged over 50%, reaching a new high for 2025; the cumulative increase over the past three months has reached 150%.

When new shares of the ETF are issued, it is necessary to buy ETH, which will lock the supply. The circulating ETH in the market decreases, putting upward pressure on the price. It is expected that Ethereum reserve asset companies will also firmly hold ETH. Registered Investment Advisors (RIA), wealth management institutions, and listed companies typically do not pursue short-term gains and rarely panic sell.

Reserve asset builders are positioning ETH as programmable collateral, an asset that can generate yield, provide security, and maintain stability.

In addition, the macroeconomic background is also favorable: a certain bill has recently been signed into effect, legalizing stablecoins as digital cash. Ethereum, as the dominant network occupying 50% of the market share, will become the biggest beneficiary.

In terms of future development, once regulatory agencies approve the ETF staking function, institutional interest is expected to continue to grow. More companies may establish Ethereum reserve assets due to the staking function, and large asset management institutions will further increase their investment allocations in Ethereum.

For traditional investors, they may realize at this moment: Ethereum has two powerful circulation channels - ETF and reserve assets. Both lock in supply and expand Ethereum's influence into the traditional economic sector.

Those who directly compare Bitcoin with the reserve assets and ETFs of Ethereum actually overlook the core differences: Bitcoin is seen as a store of value, regarded as "digital gold" in macro strategies; whereas Ethereum is endowed with practical uses. Fund issuers and reserve asset builders buy and support ETH because they value its added benefits: staking rewards, infrastructure framework, and its programmable layer as a financial application.

Bitcoin is a "holding-type" asset, while Ethereum is an "application-type" network.