Ethereum ETF One Year Anniversary: From Indifference to Enthusiasm, Institutional Confidence Significantly Increased

Three months ago, even the most fervent Ethereum supporters could hardly imagine that the Ethereum exchange-traded fund (ETF) in the United States would celebrate its first anniversary. However, today the Ethereum ETF is entering its own spotlight, having been trading since July 23, 2024, marking a full year.

In June 2025, the Ethereum ETF achieved its best monthly performance in history, with inflows exceeding $3.5 billion, which is 70% higher than the previous peak of $2.08 billion on December 20, 2024. The inflow momentum in July has been even stronger, surpassing $3 billion so far, and is expected to exceed June's figures. The past two weeks leading up to July 18 have been the best two weeks for net inflows; additionally, there has been no net outflow for ten consecutive weeks, which is the first time this has happened in its 52-week lifespan.

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, with mixed reactions from the market. After all, the Bitcoin ETF had already captured all the spotlight earlier in the year, making the debut of the Ethereum ETF rather uneventful: the price trend was sluggish, attention gradually declined, and there was consistently no large-scale capital inflow during the initial launch.

In fact, part of the early capital flow even showed a net outflow status. In the trading of the first 39 weeks, 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 change in trend over the past three months.

As of July 21, 2025, the 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 accelerating through the form of "Ethereum reserve assets." On June 2, 2025, SharpLink Gaming became the first publicly traded company in the United States to announce the inclusion of Ethereum in its strategic reserves. While the crypto community is still focused on various publicly traded 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 directors of SharpLink Gaming and serves as chairman, leading the company's $425 million Ether strategic reserve. Since the launch of this reserve asset program, SharpLink has become the world's largest enterprise-level Ether holder, holding 360,807 ETH, valued at over $1.3 billion at current prices. Additionally, the company has raised an extra $413 million and accumulated 567 ETH in rewards through staking its held Ether.

However, a new company focusing on Ethereum reserve assets is fiercely competing with it. The 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, a veteran on Wall Street, has a bigger goal: "We are steadily advancing our objective to acquire and stake 5% of the total supply of Ethereum." Currently, the total amount of Ethereum held by SharpLink and BitMine has exceeded that of the Ethereum Foundation.

Overall, the flow of funds from the Ethereum reserve asset company and ETF reflects the confidence of institutions in viewing Ethereum as an infrastructure layer investment, and this confidence continues to grow. A well-known investment firm recently reduced its positions in other platforms and instead increased its investment in BitMine Immersion, amounting to $182 million. This company previously had insufficient exposure to Ethereum and restructured its three flagship ETFs, allocating 1.5% of its portfolio to BitMine.

The new company Ether Machine, formed through the merger of existing companies, will create a publicly traded platform that provides institutional investors with professional-level access to Ethereum infrastructure and Ether yields. The company was co-founded by Andrew Keys, former board member and head of Consensys, and David Merin, former executive at Consensys and current CEO of Ether Machine. After the merger, Ether Machine plans to be listed on Nasdaq, at which time it will hold over 400,000 ETH, worth more than $1.5 billion.

The changes that have occurred in 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. The new leadership has clarified three core priorities: expanding the Ethereum base layer, optimizing Layer 2 Rollup, and enhancing the user experience.

The practical value and yield capability of Ethereum also make it an extremely attractive asset in the eyes of investors. Currently, there is no ETF in the United States offering staking rewards, and the U.S. Securities and Exchange Commission (SEC) has not yet approved it. If an Ethereum ETF can ultimately launch staking functionality, ETH is expected to become a "digital bond" in institutional portfolios.

ETFs that support staking may provide a native yield of 3%-5%. Based on the current holdings of $19.6 billion in Ethereum, even with an average yield of 4%, ETF issuers could earn over $750 million in staking income. A large asset management company is already exploring product structures that include staking, and its submitted 19b-4 amendment document clearly mentions 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 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.

If the macro environment changes, such as interest rate cuts, inflation stabilizing, 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 custodians.

The price of Ethereum has shown a correlation with institutional activity. A further breakthrough in price may trigger market optimism and attract 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 cumulative increase over the past three months has reached 150%. When new shares of the ETF are issued, ETH must be purchased, which will lock in the supply. The reduction of circulating ETH in the market will create upward pressure on the price.

It is expected that the Ethereum reserve asset company 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 returns, provide security, and maintain stability.

In addition, the macro background is also favorable: the "GENIUS Act" has recently been signed and come into effect, legalizing stablecoins as digital cash. Ethereum, as the dominant network with a 50% market share, will become the biggest beneficiary.

So, how will it develop in the future? Once the SEC approves the ETF staking feature, institutional interest is expected to continue to heat up. 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 has two powerful circulation channels - ETF and reserve assets. Both lock in supply and extend the influence of Ethereum into the traditional economic field.

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 strategy; while 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 "hold" asset, while Ethereum is an "application" network.