Crypto: Ethereum ETFs Are Not Of Interest To Anyone! According To Analysts

In the dynamic world of crypto, exchange-traded funds (ETFs) represent a significant step forward for institutional adoption and mainstream investment. Recently, attention has turned to Ethereum (ETH) ETFs, which analysts suggest may experience more moderate demand compared to their Bitcoin (BTC) counterparts.

Crypto: Ethereum ETFs Less Attractive than Bitcoin ETFs!

JPMorgan strategists, led by Nikolaos Panigirtzoglou, estimate that Ethereum ETFs could attract between $1 billion and $3 billion in net inflows by the end of the year. In stark contrast to the $15.3 billion amassed by Bitcoin ETFs. This modest forecast reflects a less broad recognition and acceptance of ETH compared to BTC crypto, which saw a rapid 169% increase in its price over the past year.

James Davies, CPO and founder of Crypto Valley Exchange, highlights that the demand for Ether might be lower due to its relatively less established notoriety. Caroline Bowler, CEO of BTC Markets Pty, adds that “Ether does not have the profile of Bitcoin” and points to BTC’s market value of $1.4 trillion, which is three times that of Ether.

Long-term Prospects of Ethereum

Despite less enthusiastic anticipation, Ethereum ETFs offer unique advantages. “ETH has utility that is mostly absent in the Bitcoin ecosystem, so a large part of the overall crypto ecosystem is tied to ETH,” says Davies, suggesting significant long-term growth potential. Matthew Sigel, head of digital asset research at VanEck, supports this view, stating that “over time, we expect that investors will conclude that the application and innovation potential within the Ethereum ecosystem might be far greater than that of Bitcoin.”

However, concerns remain regarding potential sell pressure due to the planned conversion of Grayscale’s $11 billion Ethereum fund into an ETF. Davies warns that the “sell pressure” on Ether resulting from redemptions in Grayscale’s Ethereum fund could be significant. Nevertheless, he also notes that net inflows into BTC ETFs could potentially offset this pressure.

Finally, while the potential demand for Ethereum ETFs appears promising, they are expected to attract significantly less interest compared to Bitcoin ETFs. Factors such as the absence of staking rewards and differences in market perceptions of crypto contribute to this outlook.