Ethereum ETF Anniversary: From Tepid to Booming, Institutional Investment Confidence Significantly Increased

Three months ago, the prospects for the Ethereum ETF were not optimistic, and even the most ardent supporters could hardly imagine it reaching its first anniversary. However, today this ETF is迎来属于自己的高光时刻, as it has been a year since it first traded on July 23, 2024.

In June 2025, the Ethereum ETF recorded its best monthly performance in history, with inflows exceeding $3.5 billion, a 70% increase from the previous peak of $2.08 billion on December 20, 2024. The inflow momentum in July has been even stronger, surpassing $3 billion to date, and is expected to exceed that of June. The past two weeks up to July 18 have been the best weeks for net inflows, and there have been no net outflows for ten consecutive weeks, which is the first time in its 52-week duration.

However, the development of the Ethereum ETF has not been smooth sailing. In May 2024, U.S. regulators approved the Ethereum ETF, and trading officially began on July 23 of the same year, at which time the market response was mixed. The Bitcoin ETF had captured all the attention earlier in the year, making the appearance of the Ethereum ETF feel rather uneventful: price movements were sluggish, interest gradually declined, and there was no significant influx of funds at the launch.

In fact, some initial capital flows even showed a net outflow state. In the first 39 weeks of trading, the Ethereum ETF only achieved net capital inflow in 15 weeks; in contrast, in the past 14 weeks, there were 13 weeks showing net inflow, indicating a significant shift in the trend 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.

Apart from ETFs, institutional interest in Ethereum is also accelerating through the form of "Ethereum reserve assets." On June 2, 2025, SharpLink Gaming became the first U.S. publicly traded company to announce the inclusion of Ethereum in its strategic reserves. While the crypto community is still focused on publicly listed companies incorporating Bitcoin into their balance sheets, Joe Lubin has brought Ethereum into the "reserve asset party."

As a co-founder of Ethereum and the founder and CEO of Consensys, Lubin joined the board of SharpLink Gaming and serves as chairman, leading the company's $425 million Ethereum strategic reserve. Since the launch of this reserve asset plan, SharpLink has become the largest enterprise-level holder of Ethereum globally, holding 360,807 ETH, valued at over $1.3 billion at current prices. Additionally, the company has raised an extra $413 million and has earned a total of 567 ETH in rewards through staking its held Ethereum.

Another new company laying out a strategy for Ethereum reserve assets is fiercely competing with it. Bitcoin mining company BitMine Immersion is also betting on Ethereum, holding over 300,000 ETH, valued at over $1 billion at current prices. Its chairman, Tom Lee, is a veteran of Wall Street and has bigger ambitions: "We are steadily advancing our goals, planning to acquire and stake 5% of the total supply of Ethereum." Currently, the total amount of Ethereum held by SharpLink and BitMine has surpassed that of the Ethereum Foundation.

Overall, the capital flow of Ethereum reserve asset companies and ETFs reflects the confidence of institutions in viewing Ethereum as an infrastructure layer for investment, and this confidence is continuously strengthening.

A certain asset management company recently reduced its holdings in a certain trading platform and a certain company, while increasing its investment in BitMine Immersion, with an investment amount of $182 million. The company previously had insufficient exposure to Ethereum and restructured its three flagship ETFs, allocating 1.5% of its portfolio to BitMine.

Billionaire Peter Thiel also holds 9.1% of the company's shares.

The newly formed company Ether Machine, created through the merger of existing companies, will develop a publicly traded platform to provide institutional investors with a professional-grade channel to access Ethereum infrastructure and Ether earnings. The company was co-founded by Andrew Keys, a former board member and leader at Consensys, and David Merin, a former executive at Consensys and the current CEO of Ether Machine. After the merger, Ether Machine plans to go public on NASDAQ, at which time it will hold over 400,000 ETH, valued at over $1.5 billion.

The recent leadership changes at the Ethereum Foundation may be one of the reasons driving these changes. At the end of April 2025, the Ethereum Foundation underwent a leadership adjustment, separating the board from the management team. The new leadership has clarified three core priorities: expanding the Ethereum base layer, optimizing Layer2 Rollup, and enhancing user experience.

The practical value and yield capability of Ethereum also make it an attractive target for investors. Currently, there are no ETFs in the U.S. that offer staking rewards, and the U.S. Securities and Exchange Commission (SEC) has not approved them yet. If an Ethereum ETF is eventually able to launch staking features, ETH is expected to become the "digital bond" in institutional portfolios.

ETFs that support staking may offer an inherent yield of 3%-5%. Based on the current $19.6 billion Ethereum holdings, even with an average yield of 4%, ETF issuers could earn over $750 million in staking revenue.

A certain asset management company has been exploring product structures that include staking, and its submitted 19b-4 amendment document explicitly mentions that staking is a "potential future feature pending regulatory approval," and the market is watching closely. Experts predict that the staking feature of the Ethereum ETF is expected to receive approval 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.

The market maker and trading firm Wintermute pointed out in a report released last year when the Ethereum ETF was launched that the lack of a staking mechanism is a major shortcoming that could "weaken the attractiveness of Ethereum as an ETF vehicle."

If the macroeconomic 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 from staking, and the accessibility achieved through ETFs and custodial institutions.

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

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

When an ETF issues new shares, it must buy ETH, which will lock in supply. The decrease in circulating ETH in the market will create 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 publicly 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 macro background is also favorable: the "GENIUS Act" 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 the SEC approves the ETF staking feature, institutional interest is expected to continue to grow. More companies may establish Ethereum reserve assets due to the staking feature, and large asset management institutions will further increase their investment allocation in Ethereum.

For traditional investors, they may realize at this moment that Ethereum now has two powerful circulation channels—ETF and reserve assets. Both lock in supply and extend Ethereum's influence into the traditional economic sphere.

Those who directly compare Bitcoin with the reserve assets and ETFs of Ethereum actually overlook the core differences: Bitcoin is regarded as a store of value, being the "digital gold" in macro strategies; whereas Ethereum is endowed with practical uses. Fund issuers and reserve asset builders buy and support ETH for its added value: 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.