Ethereum ETFs Leads with $225M in Inflows, Outpacing Bitcoin ETFs

Ethereum ETF Demand Soars as DeFi Legal Battle Turns in Its Favor

Since November 22, Ethereum exchange-traded funds (ETFs) have outpaced their Bitcoin counterparts, attracting more investor interest. Over just four days, from Nov. 22-27, spot Ether ETFs saw a substantial $224.9 million in net inflows, while spot Bitcoin ETFs brought in a comparatively modest $35.2 million. 

The surge in Ethereum investments comes on the heels of a major win for Ethereum’s decentralized finance (DeFi) ecosystem in a US court, while Bitcoin ETFs experienced a dip, largely due to a significant outflow on Nov. 25, according to data from Farside Investors.

Ethereum Rises on Legal Win and SEC Shift

Ethereum has surged, marking an impressive rally of nearly 8% in just one week, lifting its price from $3,560 to over $3,590. The driving forces behind this upward momentum? Industry insiders point to the recent court win for Ethereum-based Tornado Cash in the U.S., paired with growing speculation that crypto champion Paul Atkins could replace Gary Gensler at the helm of the SEC, bringing a more crypto-friendly approach to regulation.

Depending on the outcome of today's trading, this could mark the first week that US Ether funds surpass spot Bitcoin ETFs in net inflows. If the trend continues, it would highlight a shift in investor sentiment, with Ether funds gaining more traction compared to Bitcoin-focused investments for the first time in recent history.

ETH Surges as BTC Stumbles: Tornado Cash Boosts Ethereum's Rally

Over the past week, Ethereum has seen a strong surge, climbing 5.60% to $3,560, while Bitcoin has dipped by 3.55%, now sitting at $95,700. This shift has pushed the ETH to BTC price ratio up to 0.037 BTC, signaling Ethereum's dominance in the market. Despite Bitcoin's recent dip, spot Bitcoin ETFs have enjoyed a record-breaking November, with over $6.2 billion in net inflows — $3.1 billion of which came just last week.

Markus Thielen, founder of 10x Research, believes that Ethereum's price rally may have been fueled by a partial victory in the case of Tornado Cash, a major player in the decentralized finance (DeFi) space.

Ethereum Poised for a Comeback: The Shifting Regulations

As speculation swirls around Paul Atkins potentially replacing Gary Gensler as the SEC chair, Ethereum's prospects are looking up. According to analyst Thielen:

“This underperformance was previously justified before the U.S. Presidential election, but with expectations of a more favorable regulatory environment, it now presents a potential opportunity.”

• With the anticipation of a “DeFi renaissance” under a potential Trump presidency, DeFi-focused projects like World Liberty Financial could benefit, positioning the Trump family’s interests at the forefront.

• Ethereum could be seen as a “catch-up trade,” having lagged behind Bitcoin and Solana in the current bull market.

In conclusion, Ethereum has experienced a notable surge in both price and investor interest, outpacing Bitcoin in ETF inflows for the first time in recent history. This shift is largely driven by a recent legal victory for Ethereum’s decentralized finance ecosystem and growing speculation around a more crypto-friendly regulatory environment under potential SEC leadership changes. As Ethereum gains momentum, the market sentiment is shifting, positioning it as a strong contender in the ongoing crypto bull market. If this trend continues, Ethereum could see further gains, possibly leading to a DeFi resurgence.