BlackRock is Buying Ethereum in Bulk. Will ETH Outpace Bitcoin in the New Bull Market?
For nine consecutive sessions, U.S. spot ETFs for Ethereum saw a net inflow of $1.42 billion. On August 28 alone, it was $225.8 million, the highest in about ten months. BlackRock's performance looks even stronger: the ETHA ETF collected $1.02 billion over the entire nine-session series, accounting for about 72% of all inflows, and did not record a single day of outflows.
At the beginning of the current series, Bitcoin attracted about ten times more capital to ETFs than Ethereum. By August 28, the difference shrank to just $16.5 million: $242.3 million for BTC and $225.8 million for ETH. We remember how institutional demand for these two assets was in completely different leagues. Now, over several sessions, it has nearly equalized.
If the new bull market has several stages, and institutional capital begins to view ETH not as a distant number two, but as a second core position in the portfolio, the market capitalization difference between Ethereum and Bitcoin could shrink much faster than the current price suggests. The flippening (i.e., surpassing Bitcoin's market cap) remains an aggressive and speculative scenario, but at least it no longer sounds absurd.
The significant change is not that BlackRock bought a lot of ETH, but how regularly it did so; ETHA recorded positive flows every day of the nine-session series. Inflows accelerated further: the daily purchase value in the last four sessions was roughly twice as high as during the first four.
Bitcoin still has a massive narrative advantage. It is easier to explain, simpler to position in a portfolio as digital gold, and after the launch of ETFs, it received a powerful institutional distribution channel. Ethereum is more complex: network, staking, DeFi, applications, supply locked in various places. But who knows -- perhaps this complexity will finally start to work in its favor in the coming years.
Weak price reaction could be a bullish argument
With $1.42 billion in inflows, Ethereum only increased by about 5% during the mentioned series, from roughly $2350 to just under $2500. Bitcoin rose by about 15% during a similar period with $2.8 billion in inflows. Thus, the capital transmission to price was significantly weaker for ETH. The first interpretation? Ethereum is weak, and supply is pressing... But what if sellers stop using price jumps to exit their investments? The potential could then really be unleashed.
Spot volume is only in the 16th percentile of the last year, and the broader market has yet to join the ETF purchases. Even on-chain activity does not show a jump corresponding to the scale of institutional inflows. We have a situation where large buyers have already entered, but the speculative part of the market has not yet. If that changes, ETH could gain more strength.
For ETH to catch up with Bitcoin, it needs this
Ethereum desperately needs a moment when institutional accumulation meets broad market demand. If inflows remain close to current levels, ETHE will stop weighing down, spot volume will clearly rebound, and Ethereum will permanently regain the 200-week average around $2500; the current stagnation may eventually look more like absorption of supply than weakness.
Ethereum does not need to take Bitcoin's status as the main cryptocurrency for the gap between them to start shrinking rapidly. It is enough that in the new bull market, institutions begin to shift from the model of "Bitcoin plus a small addition of ETH" to selecting both assets as two core pillars of cryptocurrency exposure. Nine sessions do not decide anything yet.
But still, we see that Wall Street is starting to buy Ethereum faster, and inflows are equalizing with Bitcoin. At this stage of the rebound, this seems quite unique, and Ether is still 50% below its all-time high. This at least allows for a conversation about a real reduction in Bitcoin's advantage, provided that the crypto bull market becomes increasingly evident this fall.
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