Exchange-traded funds (ETFs) that are based on Ethereum cash have the potential to attract $15 billion in net inflows within the first 18 months, according to a report released by Bitwise’s chief investment officer, Matt Hougan. Hougan stated that this estimate is not mere speculation, but is based on data analysis. He explained that by examining the relative market capitalizations of the two largest cryptocurrencies, Bitcoin and Ethereum, one can gain insight into the potential demand for Ethereum spot exchange-traded products (ETPs). Currently, Bitcoin accounts for 74% of the combined market value, amounting to $1.266 billion, while Ethereum makes up the remaining 26% with a market value of $432 billion. Based on this data, Hougan predicts that US investors will have invested over $100 billion in Bitcoin ETPs by the end of 2025. In order for Ethereum spot ETPs to reach parity, they would need to attract $35 billion in assets, which Hougan expects to happen over the course of 18 months. However, he notes that this estimate does not account for the conversion of the Grayscale Ethereum Trust (NYSE: ETHE) into an ETP on the launch day, which will bring in $10 billion in assets. Therefore, the actual inflows needed to reach parity would be $25 billion. The report also mentions the optimistic prospects for Ethereum ETFs, as the president of the SEC, Gary Gensler, has expressed confidence in the approval of S1 forms required for their launch, indicating that it is expected to happen next summer. However, it is important to note that the views and opinions expressed in this article are for informational purposes only and should not be considered as financial or investment advice. Investing or trading in cryptocurrencies carries a risk of financial loss.
