HomeNewsEthereum ETFs: A New Horizon for Institutional Investment

Ethereum ETFs: A New Horizon for Institutional Investment

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  • Bitwise CIO predicts a $15 billion influx into Ethereum ETFs within 18 months of their anticipated launch.
  • Regulatory filings for Ethereum ETFs are underway, with potential final approvals and launch slated for mid-July 2024.

As the financial world anticipates the introduction of Ethereum ETFs, the buzz is growing about the potential these funds have to reshape Ethereum’s market presence. Matt Hougan, Chief Investment Officer (CIO) at Bitwise, has projected that Ethereum ETFs could see an influx of $15 billion within the first 18 months of their launch.

This forecast aligns with recent regulatory movements suggesting a mid-July debut for these ETFs. According to reports by Bloomberg, multiple entities are expected to have submitted their amended S-1 forms by July 8th.

Nate Geraci, President of The ETF Store, hinted that final approvals might be secured by July 12th, potentially paving the way for a launch in the week of July 15th.

The potential for Ethereum ETFs extends beyond simple market dynamics. Hougan expressed a strong belief in the appeal of Ethereum to institutional investors during a discussion with analyst Scott Melker.

He referenced consistent substantial investments in Ethereum from European and Canadian markets, which bolster his optimism about its potential success in the U.S. market as well.

Further enriching this perspective, Hougan shared insights from a strategic conversation with a major financial advisory firm managing over $100 billion in assets. The dialogue revealed a readiness to diversify into Ethereum following the ETF launch, signaling growing acceptance of cryptocurrency as a valid asset class within the broader financial community.

Source: Coinglass

However, the broader cryptocurrency market, including Ethereum, has faced a downturn, with Ethereum’s price dropping to $3,139, a decrease of approximately 6.2% in the last 24 hours.

This decline has resulted in trading losses, with Coinglass reporting liquidations totaling $317.34 million in the past day, of which Ethereum-related liquidations constituted about $76.51 million. These figures predominantly reflect losses from long positions.

Source: Coinglass

Moreover, data from CryptoQuant shows an increase in Ethereum’s Estimated Leverage Ratio across exchanges, reaching 0.392. This metric suggests a rise in leveraged positions relative to the market cap of Ethereum, indicating a potential for increased volatility or further liquidations in the near future.

Ethereum Estimated Leverage Ratio - All Exchanges
Ethereum Estimated Leverage Ratio – All Exchanges – Source: cryptoquant

The integration of Ethereum ETFs into the market is seen not only as a vehicle for substantial financial inflow but also as a potential stabilizer for Ethereum’s price by providing a structured, regulated way for institutional investors to engage with the cryptocurrency.

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Isai Alexei
Isai Alexei
As a content creator, Isai Alexei holds a degree in Marketing, providing a solid foundation for the exploration of technology and finance. Isai's journey into the crypto space began during academic years, where the transformative potential of blockchain technology was initially grasped. Intrigued, Isai delved deeper, ultimately making the inaugural cryptocurrency investment in Bitcoin. Witnessing the evolution of the crypto landscape has been both exciting and educational. Ethereum, with its smart contract capabilities, stands out as Isai's favorite, reflecting a genuine enthusiasm for cutting-edge web3 technologies. Business Email: [email protected] Phone: +49 160 92211628