• VanEck has revealed that it plans to shut down Ethereum futures ETF as the popularity of spot Ethereum ETFs rises.
• ETH has struggled to sustain bullish momentum, failing to break above the $3,000 resistance position in recent months.

American investment management firm VanEck has revealed that it will shut down Ethereum futures ETF, citing a lack of demand for the investment product. The firm, which handles about $89.5 million in assets under management, told its clientele that trading for these products will stop on September 16, and fund assets will be liquidated and returned to investors on September 23rd.

According to the firm, the decision to close the fund is a direct result of the launch of the spot Ethereum ETF, which has led to insufficient demand for the futures ETF. Additionally, other factors ” include performance, liquidity, assets under management, and investor interest,” it said.

As of September 6th, the fund, which launched last year, held about $21 million in assets under management. The VanEck Ethereum ETF (ETHV), which launched in June, held about $55 million in assets under management during the same time. Collectively, Ethereum ETFs hold approximately $6.5 billion in AUM, compared to just under $170 million across futures-based ETH ETFs. About $4.2 billion is held by the Grayscale Ethereum Trust (ETHE).

Market excerpts, including Nate Geraci, president of The ETF Store, an investment adviser, have revealed that the announcement comes as no surprise. The popularity of the Ethereum spot ETFs, which were approved and launched just a couple of months ago, has led to the decline of and the rendering of futures-based crypto ETFs obsolete.

“Guessing VanEck viewed EFUT primarily as a marketing expense,” Geraci commented. Unsurprisingly, the announcement has not led to any significant price change due to its relatively low total.

At the time of writing, Ethereum’s ETH is trading for $2,300 after a 3% drop in the last 24 hours. This means that the token has extended its weekly losses by nearly 10%.

The weekly price change is a reflection of the wider market, with large-cap cryptocurrencies extending their bearish trend to the past couple of days. Bitcoin (BTC) which has in the recent past set the market trend has lost about 8% for the week.

Earlier this year, analysts speculated that Ethereum could flip Bitcoin based on its spot ETF popularity, but the digital asset has failed to live up to expectations. Critically, as the only altcoin with an approved ETF, some are raising concerns that with more ETFs launching, its dominance will be weathered as investors choose other altcoins. For now, the token allows institutional investors to diversify from Bitcoin investment products.

Ethereum has also been facing strife competition as a blockchain for building and innovating. Due to its relatively high gas fees and the emergence of faster and cutting-edge blockchain projects, Ethereum is struggling to keep up, casting a long-term bearish outlook for ETH.

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