Eric Balchunas, senior ETF analyst at Bloomberg, tempered excitement about spot ETH ETFs, saying they would likely attract a fraction of the investment that BTC ETFs would.
On May 20, reports emerged that the chances of the U.S. Securities and Exchange Commission (SEC) approving an ETH ETF were as high as 75%, a stark contrast to previous pessimism surrounding the financial instrument.
The news sparked a more than 20% increase in ETH prices, pushing it above $3,700, according to CryptoSlate.
Additionally, blockchain analytics platform IntoTheBlock noted that the price surge prompted 90% of ETH holders to take profits.
This bullish trend has led some market analysts to predict that the ETH ETF will receive significant inflows, similar to the BTC ETF launched in January.
Since spot BTC ETFs launched in the U.S., these funds have amassed about $13 billion in assets under management, according to Farside Investors.
However, Balchunas remains skeptical, estimating that an ETH ETF might only garner “10%-15% of the assets of a BTC ETF.”
“I think my comparison of the launch of a spot ETH ETF following a BTC ETF to a concert by Sister Hazel following Nirvana is probably why some people are attacking me right now,” Balchunas said.
“That’s okay, although it’s brutal, I still think the ETH ETF will only have 10%-15% of the assets of the BTC ETF.”
Meanwhile, Fidelity filed an updated S-1 registration statement for its proposed ETH ETF with the SEC ahead of a key deadline.
The revised document has removed all traces of staking or staking rewards. Previously, the prospectus indicated that the fund would pledge some assets to vendors to earn rewards.
Analysts believe that this change is due to the SEC's review of Crypto asset investments.
The SEC has sued major exchanges such as Kraken and Coinbase, alleging that their spot-tracking products violated federal securities laws.
Balchunas added: “Did the public get a final answer on whether the SEC allows spotting? Apparently not. This is just the first amendment to SEC 180.”
