They predicted that Ethereum funds would attract only 10-15% of the assets under management of bitcoin ETFs

Analysts have said the popularity of ETH ETFs is low compared to bitcoin products

24.05.2024 - 12:40

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3 min

What’s new? Bloomberg analyst Eric Balchunas believes that if approved, Ethereum-based spot exchange-traded funds (ETFs) in the United States will attract only 10-15% of the assets under management of spot bitcoin products. Analyst Noelle Acheson also believes that ETH is vastly inferior to BTC in terms of institutional interest.

Source: Twitter.com

What else is known? According to Acheson, once ETH ETFs are approved, “we should brace ourselves for a disappointing reception.” Part of the reason for this outlook is that institutions are not showing interest in derivatives based on the largest altcoin already available in the US market.

Thus, amid traders’ optimism over the approval of spot ETH products, blockchain ecosystem-related assets and meme tokens, as well as the broader crypto market, have seen significant growth in momentum. Daily trading volume of ETH futures ETF shares on May 21 also hit a record high of $47,75 million.

For comparison, the record daily figure for spot BTC ETFs exceeds $1,05 billion. The record was set on March 12.

Assets under management of the leading US futures ETH fund EETH are only 4% of the volume of the largest futures BTC fund BITO. Both funds are owned by investment firm ProShares.

Acheson also cited the example of the situation in Hong Kong, where the regulator on April 30 allowed six spot funds to the market: three each based on BTC and ETH respectively. The share of ETH in the total assets under management of these funds does not reach 15%, the analyst said.

Acheson also referred to the Chicago CME exchange, which is the largest bitcoin derivatives platform by open interest (OI). At the same time, as a platform for ETH derivatives, it ranks only fifth.

“US institutional investors are maybe just not really into the ETH narrative?” the analyst wonders.
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Ethereum co-founder Joe Lubin earlier allowed the possibility of the opposite version of developments. In his opinion, the products will be popular and will lead to buying pressure and a sharp reduction in supply.

Securities regulator SEC has already approved a portion of the filings — Form 19b-4 applications — from BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK Invest and 21Shares, Invesco and Galaxy, as well as Bitwise. However, it must also approve Forms S-1 — launching new securities — for a full launch. Analysts concede that this process will be delayed.

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