Ethereum

Ethereum ETFs Nearing Launch: Up To $15 Billion Inflows Expected In 1st 18 Months

The wait for U.S.-based spot Ethereum(ETH) ETFs (exchange-traded funds) appears to be nearing its conclusion. Industry insiders are optimistic about a summer launch after positive developments between the Securities and Exchange Commission (SEC) and prospective ETF issuers.

“There are fewer and fewer issues being raised by the SEC during the S-1 filing review process,” said Katherine Dowling, chief compliance officer at Bitwise Asset Management, in a recent interview with Bloomberg. “This indicates we are close to the finish line for launch.”

An S-1 filing details an issuer’s offering, and its approval by the SEC is a crucial step before an ETF can begin trading.

SEC Chair Gary Gensler previously indicated a summer launch timeframe for spot Ether(ETH) ETFs. While acknowledging the extended wait for issuers, Dowling remains confident in an imminent resolution.

The positive sentiment follows the SEC’s approval of several 19b-4 filings in late May, which paved the way for spot Bitcoin ETFs to launch in the U.S. Several spot Ether ETF applications have been under review since then.

Issuers submitted amended S-1 filings in early July after receiving initial feedback from the SEC. The streamlined review process suggests a potential launch date within the remaining summer months.

Potential Inflows and Future Products

Bitwise’s chief investment officer, Matt Hougan, predicts significant investor interest in spot Ether ETFs. He estimates potential inflows of up to $15 billion within the first 18 months, mirroring the success of spot Bitcoin ETFs launched earlier this year.

Dowling also revealed the SEC’s openness to discussions regarding ETFs for assets beyond Bitcoin and Ether. “We’ve had positive dialogues about the prospects for new products,” she said.

Solana ETF Applications and Regulatory Uncertainty

While the future seems bright for Ether ETFs, the path for other cryptocurrencies remains unclear. The Chicago Board Options Exchange (CBOE) recently filed applications for spot Solana ETFs on behalf of VanEck and 21Shares. However, some experts are skeptical about their approval under the current leadership.

Also Read: Bitcoin Price Up 8.3% This Week: Can CPI & Ethereum ETFs Spark A Bull Run?

Dowling and Bloomberg ETF analyst Eric Blachunas expressed concerns about a spot Solana ETF’s prospects, particularly if Gensler remains SEC Chair under a re-elected Biden administration.

The coming weeks will be crucial for the cryptocurrency ETF landscape. With the anticipated launch of spot Ether(ETH) ETFs and ongoing discussions about other potential products, the U.S. market appears to be on the cusp of significant growth in this new asset class.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.

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