Ethereum ETFs Expected to See $10 Billion Inflows in First Year, Analyst Predicts

Ethereum ETFs Could Attract $10 Billion in First Year, Forecasts Former Goldman Sachs Exec

Ethereum ETFs – Spot Ether exchange-traded funds (ETFs) could accumulate up to $10 billion in assets under management (AUM) within their first year of trading, according to Katalin Tischhauser, Head of Investment Research at Sygnum Bank and a former Goldman Sachs executive. Tischhauser shared these projections in an interview with Cointelegraph, basing her forecast on anticipated inflows for spot Bitcoin ETFs.

Comparative Inflows: Bitcoin vs Ethereum

Tischhauser predicted that Bitcoin ETFs would attract between $30 billion and $50 billion in inflows during their initial 12 months. She suggested that Ethereum products would follow suit, though at a slower pace due to Ethereum’s lesser name recognition. “With Ethereum’s market capitalization being a third of Bitcoin’s, we expect the relative inflows to be in the 15-35% range compared to Bitcoin, resulting in a forecast of $5 to $10 billion in the first year,” Tischhauser explained.

Advantages of Ether ETFs

Tischhauser highlighted significant advantages that Ether ETFs offer to traditional investors, particularly those not equipped to handle direct crypto investments. “A familiar regulated product such as ETFs makes Ether easily accessible to investors interested in simple investment exposure,” she noted. Additionally, she pointed out that Ethereum’s position as the leading smart contract platform gives it an edge. “Ethereum, as the leading smart contract platform, is the best single asset proxy for the crypto industry with its multitude of applications and use cases.”

Ethereum’s Institutional Appeal

Tischhauser emphasized that Ethereum’s value derives more from revenues and cash flows than from its status as a safe-haven asset, making it more relatable for traditional institutional investors compared to the concept of digital gold.

Potential Price Surge for Ether

Despite the recent launch of Ether ETFs, the price of Ether has not seen significant gains. Tischhauser believes this is because the market has not priced in any potential upside, expecting inflows to be underwhelming. “This means that the price is likely to react strongly to any positive surprises. When the net flows turn positive and accelerate, this will be a strong driver for the price of Ether,” she said.

Market Sentiment and Demand Shocks

Strong inflows would impact market sentiment and create demand shocks due to the limited liquid supply of ETH, Tischhauser noted. If Ethereum inflows mirror those of BTC ETFs in the initial months, ETH prices could potentially reach $6,000. Given the bearish outlook on ETH ETF inflows, Tischhauser expects any significant inflows to have a more substantial impact on Ethereum compared to Bitcoin.

Early Performance of New ETH ETFs

The new Ether ETFs are already showing promise. Excluding Grayscale’s ETHE fund, which holds $6.7 billion in AUM, the eight new ETH funds have accumulated $1.5 billion in AUM in just their first seven days of trading. On July 31, the nine new Ethereum ETFs reversed a four-day outflow trend with a day of positive aggregate inflows, indicating that these products are gaining momentum.

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