ETH ETFs pulled in 79K tokens in a day, 34x the daily issuance, sparking a potential supply crunch.
BlackRock, Bit Digital, and others are reallocating capital from BTC to ETH as long-term infrastructure.
Ethereum leads tokenized asset adoption with $7 billion in RWAs, 59% of the global share.
Ethereum (ETH) may not dominate the headlines like Bitcoin (BTC), but under the surface, significant developments are unfolding. A powerful wave of institutional investment is quietly building in favor of Ethereum, with spot ETFs playing a central role.
With the speed at which these funds are buying tokens, there are indications that it is about to enter a prolonged period of lower supply combined with increased strategic demand.
Ethereum is trading around $2,900 with a weekly gain of nearly 17%. The underlying accumulation is anything but quiet. On 9th July, U.S.-listed Ethereum ETFs pulled in 79,000 ETH, valued at over $211 million, whereas the Ethereum network issued only 2,328 ETH. That means 34 times more ETH was purchased than created, a staggering ratio that underscores the scale of current demand.
This buying pattern isn’t isolated. Over the past week alone, Ethereum ETFs recorded net inflows of 61,000 ETH, equivalent to approximately $157 million, marking eight consecutive weeks of net accumulation. With issuance significantly outpacing purchases, Ethereum’s liquid supply is beginning to tighten, laying the foundation for a potential supply squeeze.
Behind the scenes, a notable shift is underway among institutional investors. Large players are starting to pivot toward Ethereum, not just as a hedge or speculative asset, but as a foundational piece of digital infrastructure.
Bit Digital, a publicly traded mining company, sold 280 BTC and instead acquired over 100,000 ETH, signaling a deep conviction in its long-term value. The firm noted that the coin had the potential to 'rewrite the financial system,' highlighting confidence in ETH’s evolving role.
In another significant move, SharpLink Gaming acquired 7,689 ETH in a single week and announced plans to raise $1 billion to purchase even more. These actions reflect a growing institutional appetite for ETH that goes well beyond short-term gains.
Perhaps most telling is BlackRock’s recent activity. On July 7, its iShares Ethereum Trust added 20,955 ETH, worth $53 million, to its holdings. That move brought the fund’s total ETH to a point where it now owns 1.5% of Ethereum’s entire circulating supply, a notable figure that reflects growing confidence in ETH’s future.
Ethereum isn’t just a cryptocurrency; it’s the backbone of a new financial frontier. It currently holds the dominant position in the world of tokenized real-world assets (RWAs), commanding $7 billion in tokenized assets, 59% of the global total.
This leadership isn’t coincidental. ETH’s robust, innovative contract framework makes it the preferred blockchain for institutions looking to tokenize everything from real estate to bonds. With this infrastructure in place, Ethereum’s utility stretches far beyond trading; it is becoming the primary on-chain settlement layer for traditional finance.
Also Read: Why Are Institutions Shifting from Bitcoin to Ethereum? Here's the Reason
While Bitcoin may continue to capture greater attention, Ethereum ETFs are quietly leading Bitcoin ETFs in flows. Last week alone, they captured 45,980 ETH, which dwarfs the 7,726 BTC from Bitcoin funds.
Leading the way was iShares Ethereum Trust with 29,355 ETH. Fidelity followed with 24,125 ETH, and Bitwise and Invesco added 4,284 ETH and 790 ETH, respectively. The only leak came from Grayscale's Ethereum Trust with outflows of 7,667 ETH.
In comparison, Bitcoin ETFs saw mixed flows. While several funds like Fidelity and ARK recorded small inflows, Grayscale Bitcoin Trust (GBTC) was facing net outflows of 1,200 BTC.
Currently, Ethereum ETFs have a total of 4.12 million ETH in assets, valued at just over $10.8 billion. In comparison, the total amount of BTC held by all Bitcoin ETFs combined is 1.25 million. This provides evidence that capital is continuing to rotate toward exposure via ETH rather than Bitcoin.
Also Read: Ethereum Price Analysis: Bulls Hold $2,550 Trendline as ETF Flows, Derivatives Data Support Uptrend
ETH is quietly entering a transformative phase. Ethereum tokens are released daily, and the supply is shrinking as a consequence of demand from ETFs. For institutional investors, this means that purchasing is not just to speculate but to build long-term exposure to what they increasingly view as financial infrastructure.
Along with its leadership in tokenization of real-world assets and possible future blending of staking components into ETF investments, the momentum is strategically favorable.
Ethereum may be setting the stage for a supply-induced run, and the market isn't going to stay quiet for much longer.
1. Why is Ethereum’s supply shrinking?
Because ETFs are buying significantly more ETH than the network is issuing, reducing the liquid supply across markets.
2. How much ETH do ETFs currently hold?
Ethereum ETFs hold 4.12 million ETH, valued at around $10.8 billion, more than triple the total held by Bitcoin ETFs.
3. What is driving institutional interest in Ethereum?
Institutions see Ethereum as financial infrastructure, leading to significant reallocations like BlackRock’s 1.5% ETH stake.
4. How does Ethereum compare to Bitcoin in ETF flows?
Ethereum ETFs added 45,980 ETH last week, far surpassing the 7,726 BTC added by Bitcoin funds.
5. What role does Ethereum play in tokenized assets?
Ethereum powers 59% of all tokenized real-world assets globally, making it the dominant chain in financial tokenization.