Limited Utility and Other Factors
A Bloomberg ETF analyst, James Seyffart, predicts that Ethereum spot ETFs will attract less demand than Bitcoin spot ETFs. He cites several reasons for this:
- Market Cap Difference: Ethereum’s market cap is significantly lower than Bitcoin’s, which limits the potential for investment.
- ETF vs. Cryptocurrency Gap: The difference between Ethereum as an ETF and as a cryptocurrency is greater than that for Bitcoin.
- Limited Features: ETH spot ETFs will not allow investors to access native Ethereum features like staking and DeFi.
Predicted Demand
Seyffart predicts that Ethereum spot ETFs will attract between 20-25% of the investments seen in Bitcoin spot ETFs. Another Bloomberg analyst, Eric Balchunas, is less optimistic, projecting 15-20%.
Impact on Other Crypto ETFs
The performance of Ethereum spot ETFs could influence the approval and demand for other crypto spot ETFs. However, the future of XRP ETFs remains uncertain due to regulatory concerns.
Ethereum Price Update
As of today, Ethereum is trading at $3,766, with a slight gain in the past day. It has gained over 20% in the past week, but its daily trading volume has decreased by 51.27%.
