Ethereum
Crypto investors, get ready! Spot Ether ETFs expected to launch in mid-June
Excitement grows in crypto community following recent approval Point Ether (ETH) exchange-traded funds (ETFs) could launch as early as mid-June. This timeline, however, depends on how quickly approved customers amend their S-1 registration statements and subsequent comments from the Securities and Exchange Commission (SEC).
Bloomberg ETF analyst James Seyffart suggests that S-1 approvals could come within weeks, while acknowledging that the process could take several months.
Fellow analyst Eric Balchunas remains optimistic, expecting a mid-June launch, noting that the SEC feedback process took about two weeks to spot Bitcoin ETFs.
Key steps: from approval to negotiation
Once 19b-4 filings are approved, the next crucial step is securing S-1 Registration declaration approvals, necessary to start the negotiation. VanEck quickly amended his S-1 following his 19b-4 approval, and other applicants are expected to do the same soon.
Potential challenges ahead
One potential challenge is that the SEC’s Division of Trade and Markets approves filings under “delegated authority.” This means that any of the five SEC commissioners can challenge the decision within ten days. However, digital assets attorney Joe Carlasare notes that such a challenge is unlikely, as the decision likely received unanimous consent from the commissioners.
Market Impact: What Analysts Predict
Seyffart predicts that if the S-1 is approved, Ether spot ETF could attract 20% of the investment flows observed by Bitcoin ETFs. Balchunas offers a more conservative estimate of 10 to 15 percent. Since the launch of Bitcoin ETFs, they have generated a net inflow of $13.3 billion over approximately four and a half months. If the Ether spot ETF captures 20% of that amount, it could bring in an impressive $2.66 billion over the same period, attracting investors looking to diversify their crypto portfolios.
The Future of Grayscale’s Ethereum Trust
Despite this optimism, concerns remain about the impact on existing products such as the Grayscale Ethereum Trust, which holds over $11.3 billion. The trust could face significant capital outflows as investors may prefer the new ETFs.
Historically, Grayscale’s Bitcoin Trust has experienced outflows when converted to ETF form. Major players like VanEck, BlackRock, Fidelity, Grayscale, Franklin Templeton, ARK 21Shares, Bitwise and Invesco Galaxy received regulatory approval on Thursday, May 23, indicating a strong lineup ready to meet market demand.
However, Hashdex did not receive approval, highlighting the competitive and complex nature of the ETF approval process.
Are you considering investing in Spot Ether ETFs? Why or why not?
Did you know: Ethereum Poised for 60% Surge as Spot ETF Approval Looms: QCP Report