A groundbreaking forecast for net inflows into exchange-traded funds (ETFs) focusing on Ethereum has recently come to light. Galaxy Research, in its report, projected that Ethereum ETFs could potentially attract $1 billion in monthly net inflows once approved. This information was published by Coindesk on June 27th.
Charles Yu, an analyst, emphasized, “We anticipate that net inflows into ETH ETFs will be between 20-50% of net inflows into BTC ETFs during the first five months, with our target being 30%, which implies $1 billion/month in net inflows.”
On May 23rd, the Securities and Exchange Commission (SEC) granted approval for the 19b-4 forms of eight Ethereum ETF issuers, including Grayscale, Bitwise, BlackRock, VanEck, Ark 21Shares, Invesco, Fidelity, and Franklin. However, the SEC is still reviewing the S-1 filings for these ETFs before trading can commence.
As the SEC progresses towards potentially approving ETFs tied to the spot price of Ethereum, the landscape for cryptocurrency investors may undergo significant changes. The final decision on approval is expected to be announced on July 4th, 2024.
Read also: SEC Approval of Ethereum ETF Scheduled for July 4: Reuters
Numerous ETF issuers, including industry giants such as BlackRock, VanEck, Franklin Templeton, and Grayscale Investments, are vying for the SEC’s green light. The introduction of Bitcoin spot ETFs earlier this year demonstrated the success and acceptance of these products in the market, marking a new era after years of negotiations with regulators.
According to a report released by Bitwise, it is predicted that spot Ethereum-based ETFs could attract net inflows of $15 billion in the first 18 months. Matt Hougan, the chief investment officer of Bitwise, stated, “We don’t need to speculate about the potential demand for Ethereum spot ETPs. We can simply look at the data. Everyone wants to know how much spot ether exchange-traded products (ETPs) will attract in net flows. My answer: $15 billion in the first 18 months. This is not a casual estimation. It is what the data suggests.”
The report explains that one way to estimate these potential flows is by considering the relative market caps of the two largest cryptocurrencies.
Disclaimer: The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment, or other advice. Investing or trading cryptocurrencies carries a risk of financial loss.
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