Grayscale’s Dogecoin ETF launch saw zero net inflows, highlighting muted institutional interest in meme-coin ETFs. Trading volume fell to approximately $1.41 million, far below analyst forecasts of $12 million, questioning the viability of these crypto investments.
Grayscale's Dogecoin ETF, introduced on its debut day, experienced no institutional inflows, marking a lackluster start and questioning meme-currency ETF viability in the market.
Launch Details and Initial Reactions
Grayscale Investments, led by CEO Michael Sonnenshein, launched their Dogecoin ETF. On its first day, the ETF witnessed zero net inflow, exposing minimal institutional appetite. Experts like Eric Balchunas emphasized the gap between retail popularity and institutional engagement.
"Dogecoin ETF’s first day comes in way below expectations. Zero net creations—no new capital. Shows the spread between retail trading appetite and true institutional demand.” — Eric Balchunas, Senior ETF Analyst, Bloomberg
The ETF's lack of capital inflow suggests a tepid market response, with secondary trading volumes significantly below expectations. Dogecoin's pricing also reflected market skepticism, unable to sustain gains, leaving analysts concerned about its future trajectory.
Impact on Broader Market
Broader market assets, including BTC and ETH, remained largely unaffected by the ETF's performance. Analysts warn of potential downstream effects on upcoming altcoin ETFs like XRP and LINK if similar patterns persist.
Future Outlook
Insights from previous ETF launches showcase strong demand for established cryptocurrencies like BTC and ETH, in stark contrast to meme coins. This historical context raises doubts about the long-term viability of such crypto assets in traditional financial frameworks.