Ethereum ETFs To Attract Over $4 Billion In Inflows, Says K33 Analyst

In late May 2024, the Securities and Exchange Commission (SEC) moved the spot Ethereum ETF applications into the next stage of deliberation, opening the door for the funds to begin trading as soon as this Summer. The approvals surprised many, as the SEC had not addressed the issue much after approving spot Bitcoin ETFs in January. With the approvals, many are speculating on what the ETFs could look like once they begin trading. Some predict they could be wildly successful. 

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Many consider net inflows a key metric for determining an ETF’s success. This figure provides a strong indication of the ETF's performance and sustainability over the long term. According to market analytics and brokerage firm K33 Research, Ethereum ETFs could gain up to $4.8 billion in net inflows in the first five months after launching. 

The firm made the prediction using current figures on futures-linked Ethereum ETFs and comparing them to Bitcoin products. Additionally, K33 Research believes Ethereum will begin to outperform Bitcoin and the broader crypto market after the ETFs launch. This would align with Bitcoin’s performance following the approval of Bitcoin ETFs when BTC's price increased more than 60% and reached all-time highs. 

J.P. Morgan also predicted the ETFs would bring in $3 billion in inflows in the first five months.

The spot Bitcoin ETFs have set a high bar for ETF launches. The 11 ETFs were the most successful in history, accumulating more than $12 billion in net inflows in just over two months. The funds hold over $30 billion in total inflows, netting around $15 billion after accounting for outflows from Grayscale. 

Many believe the Ethereum ETFs will be successful, albeit less so than the Bitcoin ETFs. Bitcoin is considered the safest bet among crypto investments due to its size and longevity. While Ethereum has similar characteristics, Bitcoin's greater degree of these attributes makes institutions more open to Bitcoin investments. 

Despite Bitcoin's dominance in the crypto market, Ethereum has established itself as a solid #2 token, emphasizing decentralized finance and community-built applications. In the long run, these use cases could potentially elevate Ethereum over Bitcoin, as Ethereum may have more room to adapt to changing market conditions. However, as it stands, Ethereum is still behind Bitcoin, which is expected to be reflected in ETF trading figures. 

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