Investors are eagerly awaiting the launch of spot Ethereum ETFs this month. But reports of delays appear to have vexed investors.
But once spot Ethereum ETFs hit the floor, these new products are estimated to attract net inflows of $3-$5 billion within the first six months of trading, according to a recent report published by crypto exchange Gemini.
Ethereum ETFs Poised For Massive Influx
Gemini’s analysis suggests that the introduction of spot Ethereum ETFs in the US could significantly boost total assets under management (AUM). When combining the projected new inflows with the existing assets in the Grayscale Ethereum Trust (ETHE), the total AUM for US-based spot Ethereum ETFs could reach between $13 billion and $15 billion within the first half-year of trading.
The report also pointed out that Ethereum’s market value compared to Bitcoin is currently near its lowest levels in recent years. However, the anticipated influx of capital into these new vehicles could potentially improve its market position relative to Bitcoin.
If the ETH/BTC ratio were to revert to its three-year median of 0.067, it would represent a nearly 20% increase. An even more optimistic scenario, reaching the maximum ratio of 0.087 seen in this period, would translate to a 55% rally.
According to Gemini, inflows below $3 billion in the first six months would be “disappointing,” given that spot Bitcoin ETFs attracted $15 billion in a similar timeframe. Meanwhile, inflows exceeding $5 billion, equivalent to a third of Bitcoin ETF inflows, would be viewed as a strong performance. Reaching close to 50% of Bitcoin ETF inflows, or about $7.5 billion, would be a “significant upside surprise.”
Delays in Spot Ethereum ETF Launch
Currently, eight fund issuers have received 19b-4 approvals on a spot Ethereum ETF and are awaiting final S-1 authorization to list and launch trading for the products. The previous market predictions suggested a 73% chance of these ETFs launching by July 4. However, recent developments have significantly reduced those odds.
The SEC has reportedly requested additional revisions to the applications, causing a delay. Despite this setback, the eventual approval of spot Ethereum ETFs is still anticipated. The timelines have been extended, with fund issuers asked to submit updated applications by July 8.