Markets
Spot Ethereum ETFs Expected for July 4th: Analysts Predict Inflows
The US Securities and Exchange Commission (SEC) is set to approve several exchange-traded funds (ETFs) that will track the spot price of Ethereum (ETH), reportedly until July 4th. This advancement follows final discussions with leading asset managers such as BlackRock and Grayscale Investments.
The introduction of these funds marks a significant milestone in the maturation of crypto markets and their adoption by mainstream investors. While initial reactions and long-term performance of these ETFs remain speculative, strategic initiatives by leading asset managers suggest a strong belief in Ethereum’s potential.
Analysts Discuss Potential Entries for Spot Ethereum ETFs
Asset managers seek to leverage the success of January Spot Bitcoin ETFs, which attracted $14 billion in inflows. Particularly, Grayscale aims to transform an existing trust into a spot Ethereum ETF. This reflects a strategic move to expand investment options in crypto.
Senior ETF Analyst Eric Balchunas suggests Ethereum-based funds could launch as early as July 2nd. Whereas, according to a Reuters report, the SEC may approve spot Ethereum ETFs by July 4th.
See more information: How to invest in Ethereum ETFs?
Although discussions are ongoing, sources to reveal that the remaining obstacles are merely minor adjustments to the offering documents, which are now close to final approval. Expectations about how the market will respond to these new ETFs are high. The debut of similar Bitcoin (BTC) products earlier this year saw assets rise to nearly $52.96 billion as of June 26, according to data from SoSoValue.
US Bitcoin Spot ETF Data. Source: SoSoValor
However, some analysts are cautious about Ethereum’s potential for similar success. James Butterfill, head of research at Coinshares, notes significant differences in market size and volume compared to Bitcoin. Furthermore, Bryan Armor also doubts that Ethereum ETFs will generate the same level of enthusiasm.
“With Bitcoin, there was pent-up demand for a decade and investor interest was off the charts. It’s just not going to generate the same excitement,” Armor said.
On the other hand, optimism persists among other experts. Matt Hougan, chief investment officer at Bitwise, is optimistic about the outlook. His predictions are supported by a thorough analysis of market capitalizations and a review of international ETF markets.
“Ethereum ETPs (exchange-traded products) will attract $15 billion in net flows in their first 18 months on the market,” Hougan stated.
See more information: Ethereum ETF explained: what it is and how it works
Once the SEC approves the registration statements for these funds, trading can begin within 24 hours. This is due to previous rule changes approved for large grants such as the New York Stock Exchange, Nasdaq and Cboe.
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