As the financial world stands on the precipice of a significant shift, Ethereum (ETH) has witnessed a remarkable price increase, surpassing the $3,300 mark. This surge comes in anticipation of the potential launch of spot Ethereum exchange-traded funds (ETFs) by the week’s end. Currently, Ethereum trades at $3,331, marking a 16% increase from its previous position at $2,909 just a week ago, according to data from TradingView.
Nate Geraci, President of The ETF Store and a noted ETF analyst, expressed his optimism on X (formerly Twitter), suggesting that the introduction of eight spot ETH ETFs could be imminent. “Welcome to spot ETH ETF approval week. Don’t know anything specific, just can’t come up with a good reason for any further delay at this point,” Geraci posted on July 14.
Echoing Geraci’s sentiment, an anonymous source affiliated with the ETF developments indicated to Cointelegraph on July 12 that the launch of the spot ETH funds was expected by week’s end. This has spurred a flurry of activity, with several issuers, including VanEck and 21Shares, amending their registrations last week, hoping for the SEC’s final approval to list spot Ether ETFs.
Anticipated Impact on Ethereum’s Market
The potential launch of Ethereum ETFs is widely regarded as a pivotal catalyst for ETH’s price in the forthcoming months. Tom Dunleavy, a managing partner at crypto investment firm MV Global, shared with Cointelegraph his forecast of up to $10 billion in new inflows into these funds in the months following their launch. Dunleavy anticipates that this substantial investment will propel Ether prices to new all-time highs by year-end.
Contrary to the prevailing opinion among ETF analysts, Dunleavy believes that Ether ETFs present a more straightforward proposition to Wall Street compared to their Bitcoin counterparts. “We believe that there will be strong buy pressure with a much clearer narrative that traditional investors can understand. ETH has cashflows. It can be described as a tech stock, the app store of crypto, or an internet bond,” Dunleavy noted in a Q2 investor note.
Comparing Ethereum and Bitcoin ETFs
The ease of selling Ethereum-based ETFs stems from ETH’s characteristics, which align more closely with traditional investment narratives:
- Cash Flows: ETH generates transaction fees that can be seen as a form of cash flow.
- Tech Stock Analogy: Often referred to as the ‘app store of crypto,’ Ethereum supports numerous applications on its network.
- Internet Bond: With its upcoming staking features, ETH offers returns similar to fixed-income products.
Dunleavy concluded that this narrative is easier for financial advisors to market than Bitcoin’s ‘digital gold’ concept. He also noted that despite Ethereum’s price lagging behind Bitcoin over the last 18 months, it is poised for a rapid recovery post-ETF launch.
