Spot Ethereum ETFs generated strong trading volume on their third day on the market, but demand is cooling off after their hot start. 

The cumulative trading volume among the funds on Thursday was about $850 million. Trading volume eclipsed $1.05 billion in Tuesday's session and over $950 million Wednesday.

The ETFs recorded $133.16 million in net outflows on Wednesday, a reversal from Tuesday's $106.78 million in net inflows. The Grayscale Ethereum Trust (ETHE) saw $326.86 million in net outflows — yet again, the only ether fund to log outflows, according to SosoValue.

Ahead of Thursday's trading session, the price of ether had dropped more than 7% overnight.

"The pronounced pullback… is not only unsurprising but expected," Keyrock's Justin d'Anethan told The Block. "The …