What happens if Ethereum’s $3.9 billion ETF surge keeps rolling in Q4

Spot Ethereum exchange-traded funds took in about $3.9 billion in August while U.S. Bitcoin ETFs posted roughly $750 million in net redemptions.

The split extends a summer stretch in which Ethereum funds have consistently drawn capital since late July, as Bitcoin products saw intermittent outflows.

The rotation follows a record July for Ethereum vehicles, with about $5.4 billion in net inflows that brought cumulative investor demand close to parity with Bitcoin funds for the month.

Momentum accelerated into mid-August, including the first single day above $1 billion of net creations for spot ETH ETFs on Aug. 11, according to VettaFi.

Daily flows remain uneven, but the August ledger closed with Ethereum firmly positive and Bitcoin negative on a net basis, per SoSoValue’s issuer-reported tallies.

Supply absorption is part of the backdrop. U.S. spot Bitcoin ETFs now custody around 1.29 million BTC across issuers, roughly 6–7% of the circulating supply.

On the Ethereum side, U.S. spot ETFs hold just over 6.3 million ETH, a little above 5% of the circulating supply compared with the current issuance of around 120.7 million ETH; the holdings share is reflected on community datasets such as Dune’s “Ethereum Spot ETF Overview.”

A growing ETF footprint tightens the freely tradable float over time, a dynamic that can influence price discovery if creations outpace redemptions.

Price action has mirrored the flow gap at the margin. The ETH/BTC pair pushed to a 2025 high toward the end of August, extending Ethereum’s relative outperformance since early summer.

In late August, JPMorgan framed the divergence around four themes, including steady ETF demand, a pickup in direct corporate treasury allocations to ETH, a friendlier regulatory stance on staking compared with earlier expectations, and the mechanics of creations and redemptions now in place for the funds.

Flows have been choppy day to day. The first week of August featured one of the largest single-day Bitcoin outflow prints since launch, and Ethereum briefly saw redemptions that interrupted a multiday streak.

Those reversals were later offset by creations into ETH vehicles around mid-month and a late-August bid that trimmed BTC’s weekly outflow streak, per the SoSoValue dashboards for each category. The variability emphasizes how a handful of large authorized participants can swing daily prints even as the monthly tape shows a clear split.

The Q4 turning circle?

Into September and the fourth quarter, the test is whether August’s pattern persists.

ETF wrappers now hold a material share of each asset’s supply, and Ethereum’s footprint is rising from a lower base.

JPMorgan wrote that Ethereum holdings in both ETFs and corporate treasuries could continue to grow, using Bitcoin’s larger share of supply locked in those channels as a benchmark for what could develop in ETH.

For now, the August scorecard reads as a rotation month: about $3.9 billion into Ethereum funds against about $0.75 billion out of Bitcoin funds.

If Ethereum ETFs repeat August’s pace into the fourth quarter, cumulative net inflows would exceed $11 billion by year-end, nearly doubling current ETF holdings to more than 10% of circulating supply when measured against about 120.7 million ETH.

That scale would bring Ethereum’s ETF penetration close to Bitcoin’s present share, which sits near 6–7%, reshaping the benchmark allocations institutions reference when weighing crypto exposure.

Such a shift would also leave less tradable Ethereum in spot markets, potentially intensifying liquidity squeezes during periods of directional demand.

The effect would not be limited to price, since larger ETF balances also increase the pool of assets governed by the redemption and creation mechanics that dictate arbitrage, custody, and settlement flows.

If inflows sustain, Q4 may be the first quarter where Ethereum ETFs move from a catch-up phase to an equal-weighted seat alongside Bitcoin ETFs in portfolio construction, with implications for how issuers, market makers, and treasury desks manage crypto risk into 2026.