The U.S. Securities and Exchange Commission (SEC) is expected to approve several exchange-traded funds (ETFs) that track the spot price of Ethereum (ETH) by July 4. This development follows final discussions with leading asset managers such as BlackRock and Grayscale Investments.
The introduction of these funds will be an important milestone in the maturity of the cryptocurrency market and adoption by mainstream investors. While the initial reaction and long-term performance of these ETFs remain speculative, the strategic initiatives of top asset managers suggest strong belief in Ethereum's potential.
Analysts Discuss Potential Inflows into Ethereum Spot ETF
Asset managers plan to launch an Ethereum ETF, building on the success of the spot Bitcoin ETF in January, which attracted $14 billion in inflows. In particular , Grayscale aims to convert existing trusts into Ethereum spot ETFs . This is a strategic move to expand cryptocurrency investment options.
Senior ETF analyst Eric Balchunas suggested that an Ethereum-based fund could launch as early as July 2. According to a Reuters report, the SEC could approve an Ethereum spot ETF by July 4.
Read more: How to invest in Ethereum ETF?
Discussions are ongoing, but sources say the only remaining hurdles are minor tweaks to the offering documents, which are now nearing final approval. Expectations are high on the market's reaction to the new ETF. The launch of similar Bitcoin (BTC) products earlier this year saw assets surge to $52.96 billion by June 26, according to SoSoValue data.
However, some analysts are cautious about Ethereum's chances of similar success. James Butterfill, head of research at CoinShares, points out that there is a significant difference in market size and trading volume compared to Bitcoin. Brian Armor also says he doubts whether the Ethereum ETF can generate the same level of excitement as Bitcoin.
“In the case of Bitcoin, there has been a decade of pent-up demand and investor interest is off the charts. But Ethereum won’t generate the same excitement,” says Armor.
Conversely, optimism persists among other experts. Matt Hogan, Bitwise's chief investment officer, is optimistic about the outlook. His predictions are supported by a thorough analysis of market capitalization and a review of the international ETF markets.
“Ethereum ETPs (exchange-traded products) will drive net inflows of $15 billion in their first 18 months on the market,” Hogan said .
Read more: Ethereum ETF explained: What it is and how it works
Once the SEC approves the fund's registration statement, trading can begin within 24 hours. This is because major exchanges, including the New York Stock Exchange, Nasdaq, and the Chicago Board Options Exchange, have previously approved rule changes.
