The cryptocurrency market has been eagerly awaiting the approval of Ethereum ETF applications by the SEC, with analysts optimistic about the potential growth in the market. However, the recent setback in the approval process has caused a delay, raising concerns among investors and asset managers alike.
The initial excitement surrounding the approval of Ethereum ETFs was dampened when the SEC announced that the decision would be postponed to July 8. This delay has been attributed to the regulator’s need for issuers to submit revised filings, pushing back the expected timeline for approval.
Despite the setback, asset managers remain optimistic about the SEC eventually greenlighting the first US spot Ethereum ETF applications. Many firms, including BlackRock Inc., Fidelity Investments, and 21Shares, have filed for approval and are confident in the process. Steve Kurz from Galaxy Digital even predicted the approval of an Ethereum ETF within the next couple of weeks, highlighting the firm’s experience with the Bitcoin ETF approval process.
The delay in approving Ethereum ETFs has raised questions about the potential demand for these products once they are launched. Will Ether portfolios generate a similar level of demand as Bitcoin ETFs did when they were first introduced? Analysts project significant inflows in the initial months of trading, but they may not reach the same level as Bitcoin ETFs. Matt Hougan from Bitwise projected $15 billion in net inflows within the first 18 months of trading, based on the market capitalizations of Bitcoin and Ethereum.
The delay in approving Ethereum ETFs by the SEC has caused uncertainty in the market, but asset managers and investors remain hopeful for the eventual approval of these products. The potential for significant inflows and market growth once these ETFs are launched is a promising prospect for the cryptocurrency market as a whole. Despite the setback, the industry is poised for continued expansion and innovation in the coming months.
