$ETH
Investors' attention is focused on Ethereum spot ETFs and how the products might perform in the early months after Bitcoin funds became wildly successful.
On Tuesday, the first nine U.S. Ethereum (ETH) spot ETFs opened for trading on national exchanges following final approval from the Securities and Exchange Commission (SEC). Wall Street players and retail investors can now access the second-largest decentralized crypto token, ETH, through a regulated institutional shell.
The funds debuted with nearly $10.3 billion in assets under management (AUM), according to Bloomberg's James Seyffarth. Most of this money is invested in two Grayscale products, one of which is the long-standing Grayscale Ethereum Trust (ETHE).
Here are the initial asset levels for the Ethereum ETFs launching today. The entire complex begins trading for just $10.3 billion (almost all of ETHE's assets)
As titans like BlackRock, Fidelity and VanEck battle for dominance of the spot ETH ETF market, Alluvial CEO and co-founder Mara Schmidt told crypto.news that she expects more than “$20 billion in the first months of launch.”
You may also like: Ethereum Price May Drop After ETF Approval
The influx of capital into Ethereum spot products is also likely to push the price of ETH well above its previous peak of $4,878. At the time of writing, Ether is changing hands at $3,400, about 28% below its all-time high (ATH).
Schmidt stated: “With approximately 38% of the current ETH supply concentrated in staking, bridges and DeFi, and another 10% located on retail exchanges, ETF-based ETH inflows could have a significant impact on driving prices higher.”
Alluvial's CEO predicted that the upcoming supply shock caused by the Ethereum ETF purchase, coupled with the spot success of the Bitcoin ETF (BTC) and growing demand for cryptocurrencies, is strengthening the bullish sentiment for the remainder of this cycle.
Ethereum spot ETFs have been noticeably absent from bets, but Schmidt believes the development could create opportunities rather than problems.
“An interesting and important difference between BTC and ETH is that Ethereum offers a natural rate of return, currently around 3.3%, which may prove attractive to investors looking for alternatives to fixed income stocks that allow for diversification portfolio and hedge against inflation,” Schmidt explained to crypto.news in a private note.
