A notable feature of this round of crypto bull market is the influx of institutional capital, and spot Bitcoin ETFs have become an important channel for institutional funds to enter the market in compliance with regulations.
With the further development of the crypto market and the gradual clarification of the regulatory environment, the upcoming approval of the spot Ethereum ETF and the Solana ETF application submitted by VanEck to the SEC have undoubtedly brought new vitality and expectations to the crypto market. The launch of these ETF funds will undoubtedly bring more incremental funds and users to the crypto market, thereby promoting the prosperity and development of the entire market.
In this round of bull market, the crypto market lacks innovation in some aspects. Will this bull market be mainly led by ETFs? Let’s sort out the latest progress and operation of the current cryptocurrency ETF funds.
1. Spot Bitcoin ETF
Since BlackRock submitted its application for a spot Bitcoin ETF in June last year, after more than half a year of hard work, in January this year, the US SEC finally approved 11 spot Bitcoin ETFs.
The SEC's approval of the spot Bitcoin ETF is an important milestone in the history of cryptocurrency development. The spot Bitcoin ETF is a "bridge" between the crypto market and the securities market, which means that a large number of institutions will be able to conduct compliant Bitcoin transactions through this "bridge".
The U.S. spot Bitcoin ETF fund has been running for nearly half a year. Let’s take a look at its “achievements” in the past six months.
As of June 27, the total size of U.S. spot Bitcoin ETF funds has reached US$53.13 billion, accounting for 4.38% of the total market value of Bitcoin.
Although Grayscale's GBTC experienced a period of net outflows in the early days of ETF approval due to early user arbitrage and high funding rates, other spot Bitcoin ETFs have maintained a net inflow trend. In the end, the US spot Bitcoin ETF as a whole achieved a net inflow of US$14.45 billion, which fully demonstrated the strong market demand for spot Bitcoin ETFs.
Currently, BlackRock's spot Bitcoin ETF fund's BTC holdings have reached 305,600, exceeding Grayscale's 276,000, making it the largest spot Bitcoin ETF fund at present.
Judging from the capital inflow and outflow trends of the more influential BlackRock (IBIT) and Fidelity (FBTC), they have basically been in a net inflow state for a long time. This shows that the launch of the spot Bitcoin ETF fund is in line with market demand and that the traditional securities market has a strong demand for Bitcoin.
2. Spot Ethereum ETF
After the spot Bitcoin ETF was approved by the US SEC, asset management institutions such as BlackRock have turned their attention to the spot Ethereum ETF fund. After all, apart from Bitcoin, Ethereum is of course the most widely recognized currency in the crypto market.
At present, the progress of the spot Ethereum ETF has made some key progress, such as:
1) On May 24, the U.S. SEC simultaneously approved the 19b-4 filings of eight spot Ethereum ETFs, including BlackRock, Fidelity, Grayscale, Bitwise, VanEck, Ark Investment, Invesco Galaxy, and Franklin Templeton.
Moreover, various applicants have submitted S-1 form documents. According to relevant procedures, transactions can be carried out after the SEC approves the final S-1 document.
2) On June 19, the SEC concluded its investigation into Ethereum 2.0 and will not accuse the sale of Ethereum of being a securities transaction, which will clear the way for the smooth launch of the spot Ethereum ETF.
When will the spot Ethereum ETF be listed?
Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), recently said that he expects to see a spot Ethereum ETF listed as early as September.
How much money will the spot Ethereum ETF bring to the market?
Galaxy Research said in a report on Wednesday that once a spot Ethereum ETF is approved for trading, monthly net inflows could reach $1 billion.
Bitwise CIO Matt Hougan said the U.S. spot Ethereum ETF could attract $15 billion worth of net inflows in the first 18 months after its listing.
The approval of the spot Ethereum ETF and the subsequent capital inflow will inevitably drive a surge in ETH prices. Let’s take a look at the predictions of some institutions.
On June 19, QCP Capital stated that despite uncertainty surrounding the acceptance of ETH spot ETFs, if 10-20% of Bitcoin ETF traffic can be captured, it could push ETH above $4,000.
A report from Steno Research said Ethereum is expected to reach $6,500 later this year due to strong ETF inflows and other positive factors.
3. Hong Kong Spot Bitcoin / Ethereum ETF
Following the issuance of spot Bitcoin ETFs in the United States, the Hong Kong market became the first market in Asia to issue spot Bitcoin and Ethereum ETFs.
On April 24, the first batch of Hong Kong Bitcoin and Ethereum spot ETF products applied for by the Hong Kong subsidiaries of China Asset Management, Bosera Asset Management and Harvest Asset Management have been officially approved by the Hong Kong Securities and Futures Commission and began trading on April 30.
According to data from the sosovalue platform, the Hong Kong spot Bitcoin ETF fund holds a total of 3,420 bitcoins with a holding value of US$207 million.
The Hong Kong Spot Ethereum ETF Fund holds 12,440 ETH, with a holding value of more than US$40 million.
The total holdings of the Hong Kong spot Bitcoin/Ethereum ETF are worth less than US$300 million, which is a big gap compared to the total holdings of the US spot Bitcoin ETF, which is worth more than US$50 billion.
Although the holding value of Hong Kong's spot Bitcoin/Ethereum ETF is less than one percent of the market value of the US spot Bitcoin ETF, and its size cannot be compared with that of the United States, Hong Kong is still of great significance as the first market in Asia to issue spot Bitcoin and Ethereum ETFs. After all, it provides Asian capital with a compliant channel for Bitcoin/Ethereum transactions.
Solana ETF
In addition to Bitcoin and Ethereum, the most popular ETF in the market is Sol ETF. After all, Solana is a public chain in the United States and it is mainly driven by Wall Street capital.
On the evening of the 27th, market news said that VanEck had submitted an application for the Solana ETF, which immediately ignited the Solana ecosystem. The price of SOL once exceeded US$150, and Solana ecosystem tokens such as JTO also soared by more than 10%.
Subsequently, Matthew Sigel, head of digital asset research at VanEck, confirmed the news in a post on the X platform. VanEck has applied to the U.S. Securities and Exchange Commission (SEC) for the Solana ETF, which is the first Solana ETF applied for in the United States.
In fact, as early as June 20, 3iQ had submitted the Solana ETF application in Canada.
Although the listing and trading of the Solana ETF may still face great resistance, with the efforts of major institutions and the change in the US government's attitude towards cryptocurrencies, the Solana ETF will definitely be approved.
In addition, in addition to Bitcoin, Ethereum, and Solana ETF funds, a large number of other related cryptocurrency ETF funds are also on the way to application. For example, a proposed Bitcoin and gold combined ETF may be launched on September 9. T-Rex also recently applied for a 2x Microstrategy stock MSTR ETF.
In short, with the outstanding performance of spot Bitcoin ETFs and the upcoming launch of spot Ethereum ETFs, cryptocurrency-related ETFs will spring up in the future. This will not only open up more abundant investment channels for investors in traditional fields, but will also attract a large number of incremental users and funds to flow into the crypto market, thereby greatly promoting its growth and prosperity. In this process, the rise of ETFs and the Fed's interest rate cut policy are likely to become the two key driving forces for the booming development of this round of crypto markets.
