Trump and Staked Ether : A New Era for Crypto ETFs ?

The return of Donald Trump to the White House is not limited to traditional political questions. For the crypto industry, his election could redefine the contours of financial regulation, particularly for financial products related to Ether (ETH), the second-largest cryptocurrency by market capitalization. Indeed, the possibility of an ETF based on staked Ether could represent a decisive step for the sector. Thus, some analysts, like Edward Wilson from Nansen, believe that such a product could diversify investment options while also strengthening the position of Ether as a strategic asset. This scenario, although conditioned by the political context, could change the dynamics of the crypto market in the United States and open up unprecedented prospects for investors.

Towards a staked Ether ETF under the Trump era ?

The re-election of Donald Trump is seen as an asset for the crypto industry in the United States. According to Edward Wilson, an analyst at Nansen, this change in leadership could provide significant support for innovation in the crypto sector. Wilson states that “a pro-crypto administration could enable the rapid approval of an ETF based on staked Ether,” a product that capitalizes on the specificities of Ether as a staked asset. This type of fund would offer investors the chance to benefit from the advantages of staking without facing the technical complexities often associated with this activity.

The potential of this ETF goes beyond diversifying investment options. Indeed, Bitcoin-based ETFs, already in circulation, have played a major role in the growth of crypto investments. Thus, the price of Bitcoin has risen above $75,000. A staked Ether ETF could generate a similar enthusiasm for Ether, potentially propelling its price beyond its previous historical peak of $4,800, reached in November 2021. “The structure of the staked ETF would leverage the strengths of Ether,” he specifies. Moreover, he indicates that this innovation could propel Ether to new heights. This perspective makes Ether a particularly monitored asset, which could benefit from a new momentum under the Trump presidency.

The prospects in Europe and the challenges of the American market

While the American market might soon see the birth of this staked Ether ETF, some investors believe that Europe could take a head start. Charles d’Haussy, CEO of dYdX Foundation, shared during the EthCC in Paris, the major event dedicated to Ethereum, that the European market is “probably more mature” to welcome this type of innovation. According to him, Europe would be ready to authorize such products well before the United States, due to a more flexible approach to crypto regulation on the continent. D’Haussy is optimistic about the next step for ETFs related to Ether.

However, in the United States, the first spot ETFs in Ether, launched earlier this year, have not met the expected success. They have recorded over $489 million in net outflows since their launch, according to data from Farside Investors. This lack of enthusiasm raises questions about the actual appetite of investors for Ether compared to Bitcoin, while some analysts, like Eric Balchunas from Bloomberg, describe Ether ETFs as mere “acolytes” of Bitcoin-linked products. Such a situation reflects the challenges that the staked Ether ETF will need to overcome to attract the interest of institutional investors.

The return of Trump could very well be a development opportunity for the crypto industry in the United States, with significant repercussions for Ether if a staked ETF were to come to fruition. However, the road is fraught with obstacles, both in terms of market acceptance and international competition, particularly from Europe. Between opportunity and uncertainty, the future of Ether seems suspended on this pivotal decision.