Ethereum ETFs Poised for $10 Billion Growth in First Year, Sygnum Bank
Ethereum exchange-traded funds (ETFs) could accumulate up to $10 billion in assets under management (AUM) during their first year, according to Sygnum Bank.
Katalin Tischhauser, Head of Investment Research at Sygnum Bank and former Goldman Sachs executive, shared her insights in an interview with Cointelegraph. She based her projections on anticipated inflows into spot Bitcoin ETFs, predicting they could reach $30 billion to $50 billion within their first year. Ethereum ETFs are expected to follow this trend, although at a slower pace due to Ethereum's lower name recognition compared to Bitcoin.
"With Ethereum’s market capitalization a third of Bitcoin’s, we expect relative inflows to be in the 15-35% range versus Bitcoin, resulting in a forecast of $5 to $10 billion in the first year," Tischhauser explained.
Tischhauser highlighted the advantages that Ethereum ETFs offer over direct crypto investments for traditional investors. ETFs provide a regulated, familiar product that simplifies investment exposure to Ether without the complexities of trading and managing cryptocurrencies directly.
Unlike Bitcoin, which is often seen as digital gold, Ethereum's value is tied to its revenue and cash flow from its vast array of applications. This makes it more relatable for traditional investors seeking tangible financial metrics.
Despite the launch of Ether ETFs, the asset's price hasn't seen significant gains. Tischhauser believes this is because the market hasn't fully priced in potential positive inflows, leading to potential strong price reactions to any unexpected positive surprises. As net flows turn positive and accelerate, they could significantly drive Ether's price.
She noted that if Ethereum inflows mirror those of BTC ETFs in the early months, ETH prices could surge to $6,000. Tischhauser also emphasized that substantial ETF inflows could have a more significant impact on Ethereum than Bitcoin due to current bearish sentiment around ETH ETF inflows.
