- U.S. regulators’ pending approval for Ether ETFs might trigger trading start as early as this month.
- Compared to Bitcoin, Ether’s lower exchange availability might make its price more responsive to ETF inflows.
Tom Dunleavy, a managing partner at the cryptocurrency investment firm MV Global, anticipates a substantial financial inflow into Ether (ETH) exchange-traded funds (ETFs), which could propel Ether’s prices to record highs by the end of the year. Dunleavy shared his insights with Cointelegraph, projecting that ETH could see between $5 billion to $10 billion in new investments post-ETF launch.
Ether ETFs, awaiting final approval from U.S. regulators, are expected to start trading soon, possibly within this month. These funds are poised to capitalize on the growing interest in cryptocurrency investments through traditional financial products. According to Dunleavy, Ether’s ETF could attract about $1 billion monthly over the next few months.
Dunleavy explained that Ether’s market is particularly conducive to a sharp price increase following the ETF launch. He noted that Ether is generally less available on exchanges than Bitcoin, which means it has thinner order books and less available for purchase. This scarcity could make Ether’s spot price more sensitive to the increased demand expected from ETF inflows.
The impact of similar financial products has been noted in the past with Bitcoin ETFs, which led to a 36% price increase from their launch in January to their peak.
Dunleavy suggests that the narrative surrounding Ether, often likened to a tech stock or an “internet bond” makes it an attractive option for traditional investors and financial advisors, distinguishing it from Bitcoin’s “digital gold” appeal.
Despite Ether’s potential for a significant rally, Dunleavy cautioned that this might not necessarily extend to other altcoins. He highlighted the distinct market segments between institutional and retail crypto investors.
Those investing in Ether through ETFs are likely to be traditional investors, possibly incorporating crypto into their retirement plans, rather than users engaged with the on-chain activities of the crypto world.
As the year progresses, the cryptocurrency market watches closely as the anticipated approval and launch of Ether ETFs could mark a shift in how institutional investors engage with crypto assets, potentially setting the stage for a new era of mainstream crypto investment.
