JPMorgan expects new Ethereum spot ETFs to attract $1 billion to $3 billion in net inflows in the remainder of 2024

The recent approval by the US Securities and Exchange Commission (SEC) of spot Ethereum exchange-traded funds (ETFs) sent cryptocurrency prices higher.

According to JPMorgan, the gap between price and net asset value (NAV) of the Grayscale Ethereum Trust (ETHE) has almost closed, but fluctuations are expected if the launch of Ethereum spot ETFs in the United States suffers further delays .

Although the SEC has approved the Forms 19b-4, the S-1 filings are still being reviewed.

The approval of these ETFs, which appears to exclude staking features to ensure SEC approval, suggests that the SEC may consider Ethereum a non-staking commodity.

JPMorgan analysts believe the SEC is unlikely to approve ETFs for other tokens, which are considered more centralized and viewed as securities, unless US policymakers pass laws treating most cryptocurrencies as raw materials, a scenario considered less likely before the US elections.

JPMorgan raised questions about the potential for investor entry into the recently approved Ethereum spot ETFs. The bank anticipates that demand for these ETFs will be a fraction of what was seen for Bitcoin spot ETFs.

Reasons include Bitcoin's first mover advantage, lack of a Bitcoin Halving-like demand catalyst, initial exclusion of staking on Ethereum ETFs, Ethereum's different value proposition as an application token, lower AUM /liquidity and the relative market size of Ethereum compared to Bitcoin.