There is a sense of optimism among asset managers regarding the approval of the first U.S. ETFs directly investing in Ethereum by the Security and Exchange Commission (SEC). The SEC has set a deadline for ETF applicants to submit updated paperwork and amended S-1s by July 8. There are expectations of potential additional rounds of filings, as reported by Bloomberg citing sources familiar with the matter.
Head of asset management at Galaxy Digital, Steve Kurz, expressed his belief that an Ether ETF could possibly be approved within the next couple of weeks, indicating that the SEC is actively engaged in the process. Despite the minor questions raised by the SEC, issuers are working on addressing them to move the approval process forward, as mentioned in the report.
Major asset managers like BlackRock, Fidelity, Ark 21Shares, and Invesco have pending filings for Ethereum ETFs, but many issuers are yet to disclose their fund fees before trading can commence. There are uncertainties regarding whether Ethereum ETFs will attract the same level of demand as spot Bitcoin ETFs, which have gathered $52 billion in assets since their launch in January. Analysts have varied estimates about the potential impact of Ethereum ETF flows on ETH prices, predicting a possible 30% fall following their launch.
Market Outlook
Despite the uncertainties surrounding the approval of Ethereum ETFs, crypto research firm K33 Research remains optimistic about Ethereum outperforming Bitcoin in July. The firm views ETFs as a catalyst for strengthening Ethereum relative to Bitcoin as the summer progresses and flows accumulate. With Bitcoin facing potential selling pressure from the distribution of nearly $9 billion worth of BTC linked to the defunct Mt. Gox exchange, Ethereum prices have experienced a 3% decline during Asian trading recently.
Current Position of Ethereum
Although Ethereum reached a ten-day high of over $3,500 earlier this week, its price has since dropped, mirroring the overall trend in the crypto markets. Currently, Ethereum is down 17% from its 2024 peak and 31% from its all-time high in November 2021. The lack of positive momentum in Ethereum’s price amidst market fluctuations underscores the challenges and uncertainties facing the cryptocurrency in the near term.
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