Spot Ether ETFs May Play Second Fiddle to Bitcoin ETFs in the U.S.
The anticipated introduction of United States-based spot Ether exchange-traded funds (ETFs) might not match the impact of the more established spot Bitcoin ETFs. According to Eric Balchunas, a senior ETF analyst at Bloomberg, the inflows from the upcoming spot Ether ETFs could fall short compared to the record-breaking inflows witnessed by spot Bitcoin ETFs.
In an exclusive interview with Cointelegraph, Balchunas remarked, “Bitcoin is like enough crypto hot sauce. You’re like, you know I’m good. These things move together anyway. Ethereum is harder to explain, but I’m just seeing it being a sidekick [to Bitcoin].” He elaborated that while Bitcoin’s concept as “digital gold” is relatively straightforward, Ethereum’s broader decentralized finance (DeFi) ecosystem resembles a tech stock, making it more challenging for traditional retail investors to grasp.
Expert Opinions on Ether ETF Launch Expectations
Some experts believe that the industry’s high expectations for spot Ether ETFs may lead to disappointment, particularly when compared to the launch of spot Bitcoin ETFs, which was among the most successful ETF launches in history.
However, Ophelia Snyder, co-founder of 21Shares, holds a more optimistic view regarding the Ether ETF launch. Speaking to Cointelegraph, she said, “The idea that [the Bitcoin ETF launch] is the standard is not realistic. The Ether ETFs will be a successful ETF launch. It will do significantly better than the average ETF. I think it will probably do in the top decile of ETF launches ever.” Snyder also emphasized that investors should temper their expectations, noting that the inflows during the Bitcoin ETF launch were exceptionally high.
The launch of U.S.-based spot Bitcoin ETFs saw over $701 million worth of Bitcoin amassed in the first week and more than $540 billion in the second week of trading, according to data from Dune.
Timing of the Spot Ether ETF Launch
On June 25, Securities and Exchange Commission (SEC) Chair Gary Gensler mentioned that the Ether ETF launch is “going smoothly” in the U.S. However, he did not confirm whether the ETFs would be live before the November election. “It’s really about the asset managers making the full disclosure so that those registration statements can go effective,” Gensler stated.
The SEC approved 19b-4 filings from eight ETF applicants on May 23, but the asset managers are still finalizing their Form S-1s — the final documents the SEC needs to approve before trading can commence. Some analysts have speculated that the SEC could greenlight these funds for trading as early as the first week of July.
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