On July 23, nine spot Ethereum ETFs were successfully listed after approval by the U.S. SEC. This can be said to be an important milestone in the cryptocurrency industry, which will have a significant impact on the landscape of cryptocurrency investment in the long run.
What is an ETF?
Exchange-traded funds (ETFs) are popular investment funds traded on stock exchanges. They are usually composed of assets such as stocks, bonds, commodities or other securities, allowing investors to invest in various asset classes without having to purchase each security separately. In simple terms, investors do not need to purchase cryptocurrencies directly, they only need to purchase funds to indirectly invest in BTC and ETH. At the same time, the ETF channel is a compliant investment channel monitored by the SEC, which is of great significance.
Previously, Bitcoin spot ETFs have been on the market for some time. American asset management giants such as BlackRock, VanEck, and Franklin Templeton have launched their own Bitcoin ETF funds, with a total asset size of approximately US$8 billion. This shows how strong its ability to attract money is, and it was accumulated even when the market environment was not very good. In the long run, this value will continue to soar.
ETFs come in many types and can be bought and sold at fluctuating prices throughout the trading day, so they are very flexible and usually a diversified investment portfolio that can spread investors' risks. In addition, the operating fees are lower than those of active mutual funds. Therefore, they are very suitable for the participation of traditional investors outside the circle, and these characteristics will also attract more traditional institutions and individuals.
Compared with Bitcoin ETF, which had a net inflow of more than 15 billion US dollars in the first five months, Ethereum's initial circulation is only about 20% of the former, and even lower recently, with continuous outflow. However, in the long run, it still has great potential, after all, it is the second dragon, and the ecology has been very prosperous after years of development.
In summary:
The approval of the Ethereum ETF will have a lasting positive impact on ETH in the long run, attracting more and more traditional investors and institutions to join, and it will also be a good boost to the entire cryptocurrency. The more people and funds that come in, the better for the development of the market. Be patient and wait for major changes in the market environment, there are still many opportunities. Look forward to ETH breaking new highs soon! $ETH