The incoming Ether-based exchange-traded funds (ETFs) may only be a “sidekick” to the more established spot Bitcoin ETFs.
The inflows generated from the upcoming launch of spot Ether (ETH) ETFs could disappoint compared to the record-breaking inflows of spot Bitcoin (BTC) ETFs, according to Eric Balchunas, senior ETF analyst at Bloomberg.
Speaking exclusively to Cointelegraph, Balchunas said:
“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].”
While Bitcoin’s value proposition as “digital gold” is relatively easy to comprehend, Ethereum and its wider decentralized finance (DeFi) ecosystem is more akin to a tech stock, which makes it harder to understand for traditional retail investors, Balchunas explained.
Ether ETF launch expectations: experts weigh in
Some experts suggest that the Ether ETF may disappoint because the industry is comparing it to the Bitcoin ETF launch, which is one of the most successful ETF launches in history.
However, Ophelia Snyder, the co-founder of 21Shares, expects the Ether ETF launch to perform well in terms of inflows. She told Cointelegraph:
“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.”
However, Snyder noted that investors should adjust their expectations and consider that the inflows surrounding the Bitcoin ETF launch were far above average.
The U.S. spot Bitcoin ETFs amassed over $701 million worth of Bitcoin (BTC) within the first week and over $540 billion within the second week of trading, Dune data shows.
When can we expect the spot Ether ETF launch?
On June 25, Securities and Exchange Commission (SEC) Chair Gary Gensler said that the Ether ETF launch is “going smoothly” in the United States.
However, Gensler remained tight-lipped about whether the ETFs could go live before the November election.
“It’s really about the asset managers making the full disclosure so that those registration statements can go effective.”
The SEC approved 19b-4 filings from eight ETF bidders on May 23, but the asset managers are still tweaking their Form S-1s — the final filings the SEC needs to approve before they go live for trading.
Some analysts have predicted that the SEC could approve the funds for trading as soon as the first week of July.