The cryptocurrency world is about to witness another historic milestone with the imminent launch of Ethereum spot ETFs in the US market.
According to sources close to the matter, Ethereum ETFs could begin trading on major US stock exchanges as early as Tuesday, July 23. The imminent launch of these financial instruments will mark a crucial milestone for ether, currently the second-largest cryptocurrency by market capitalization.
Bloomberg ETF analyst Eric Balchunas confirmed information shared by Nate Geraci, president of ETF Store, on X indicating that the Securities and Exchange Commission (SEC) has requested issuers to file final versions of their S-1 forms by Wednesday, with the intention that The funds will begin trading on Tuesday of next week.
According to Geraci, the SEC has so far given final approval to 3 of the 8 Ethereum ETF issuers to begin trading on the market on July 23.
Geraci said the approval comes amid the securities regulator's filing for the funds' final S-1 forms and that he expects all eight ether ETFs submitted by the issuers to launch simultaneously in the U.S. market.
This news has created quite a stir in the crypto community and on Wall Street, as it represents a significant step towards the integration of Ethereum into traditional financial markets.
What will be the impact of Ethereum spot ETFs?
While the launch of spot ether ETFs means a sign of legitimacy for the second largest cryptocurrency on the market, Expectations about the impact of these crypto investment instruments are divided.
On the one hand, some analysts believe that the listing of these ETFs will generate a massive influx of capital into the cryptocurrency. On the other hand, there are those who maintain a more cautious and conservative forecast, due to the reduced attractiveness that these instruments could have for investors due to the lack of ETH staking operations in the funds.
Citi, in a recent research report, highlighted that Ethereum spot ETFs could record net inflows of between $4.700 billion and $5.400 billion in their first six months trading. This figure represents roughly 30% to 35% of the levels seen in spot Bitcoin ETFs, suggesting more muted enthusiasm from ether investors.
Among the reasons Citi cited for its more conservative projections are the lack of clear long-term diversification benefits from Ethereum, the absence of staking, and, among others, the competitive advantage that Bitcoin has as the first cryptocurrency to be launched in an ETF format in the US market. According to Citi, these factors could limit the initial appeal of Ethereum spot ETFs.
Additionally, Balchunas commented that the listing of ether funds, scheduled for July 23, coincides precisely with the week of the largest Bitcoin conference of the year, The Bitcoin Conference 2024, which will take place in Nashville, Tennessee, from July 25 to 27 and will feature the participation of the most prominent players in the crypto world, as well as the United States presidential candidate, Donald Trump, as one of the main speakers.
“Ironically and a little funny, 23/7 is right in the middle of the biggest bitcoin conference of the year”, Balchunas commented.
ETH is approaching $3.500
The impending launch of these ETFs comes at a time when Ethereum is showing positive performance in the market.
At the time of writing this article, the cryptocurrency is is quoted at around $3.480 dollars per unit, registering an increase of 3,4% in the last 24 hours and 13,5% in the last week. According to analysts, this bullish rebound in the ETH price This could be related to the positive expectations generated by the possible launch of spot ETFs next week.
Source: CoinMarketCap
Overall, the launch of Ethereum spot ETFs represents a significant step in the maturation of the cryptocurrency market and its integration with traditional finance.
These crypto investment instruments will allow thousands of institutional investors interested in cryptocurrency to Access and exposure to ETH in a direct and regulated manner, through an instrument they are familiar with. All this, without having to buy or hold the cryptocurrency, removing the technological hurdles of investing in cryptocurrencies and providing an easy way to gain exposure to the price of ETH.
