As a researcher with extensive experience in the cryptocurrency and exchange-traded fund (ETF) markets, I’ve closely followed the developments surrounding the anticipated launch of spot Ethereum ETFs in the United States. Based on my analysis and the latest research from K33, I believe we can expect a significant influx of capital into these investment vehicles.
According to K33 Research, traders’ current holdings indicate a moderate level of anticipation towards Ethereum spot ETFs. Although this past week was relatively quiet, there is a widespread belief that the introduction of these funds could follow a trajectory similar to the explosive growth experienced during the launch of Bitcoin ETFs.
As a researcher, I’ve uncovered some intriguing data from our firm. We project that spot Ethereum Exchange-Traded Funds (ETFs) could draw in approximately $4 billion during the first five months following their debut.
$4B Windfall Anticipated for Ethereum ETFs
The anticipated debut of Ethereum-backed exchange-traded funds (ETFs) in the US market is projected to draw substantial investment, potentially bringing in approximately $4 billion within the initial five months, as per recent industry estimates.
K33 Research conducted an analysis: they examined the total value of Ethereum-based exchange-traded products globally, contrasting it with Bitcoin’s equivalent products. Additionally, they assessed the open interest in futures contracts on the Chicago Mercantile Exchange (CME), a favored platform for institutional investors.
As an analyst, I’ve noticed an intriguing disparity between the current open interest in Ethereum (ETH) futures on the CME and that of Bitcoin (BTC) futures. Specifically, ETH open interest accounts for only 23% of BTC open interest at present. However, since ETH futures were introduced on the CME in 2021, the average share has hovered around 35% of BTC open interest. This discrepancy is indicative of substantial institutional demand for Ethereum exposure in the US market, as per my analysis at K33.
The endorsement of Bitcoin ETFs caused a significant surge in the value of Bitcoin, the leading digital currency, resulting in over 60% price increase and pushing it to unprecedented peak levels. As per K33’s analysis, introducing Ethereum ETFs may lead Ethereum to surpass Bitcoin’s performance, marking a shift after almost two years of underperformance.
As a researcher studying the world of exchange-traded funds (ETFs), I’ve come across Eric Balchunas’ prediction regarding spot Ethereum ETFs. He anticipates that these new Ethereum ETFs could potentially draw in between 10% and 20% of the investment flows experienced by their Bitcoin counterparts.
“Expectations for Ether ETFs in terms of flows, volume, media coverage, and everything else should be scaled down by about half compared to Spot Bitcoin ETFs. However, achieving even 20% of their success would still represent a significant triumph and successful launch according to standard ETF metrics.”
Staking Abandoned By Ether ETF Issuers
As a researcher examining the Ethereum ETF application process, I’ve noticed that some applicants have deliberately left out sections in their filings which would allow for staking of the fund’s assets. This is presumably an attempt to address the SEC’s apprehensions regarding staking being considered an illegal offering by cryptocurrency platforms, possibly leading to unregistered securities. The SEC’s stance on this matter becomes more evident as they have taken regulatory actions against several crypto platforms for providing staking services to US clients.
As a crypto investor, I’ve taken note of K33’s recent findings. Specifically, their report indicated that leaving out the staking feature in Ethereum Exchange-Traded Funds (ETFs) wouldn’t significantly decrease the inflows into these investment vehicles for me and other investors.
As a crypto investor, I’ve noticed an interesting difference between Canadian and European Ethereum ETFs. While approximately 99% of the assets under management in Canadian Ethereum ETFs are not involved in staking, the same can be said for about 98% of the assets in European Ethereum ETFs. In simpler terms, most of the Ethereum held in these funds is not being staked to earn rewards or validate transactions on the network.
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2024-06-05 14:28