The initial demand for spot Ethereum ETF may be lower than expected
Market maker Wintermute believes that an Ethereum ETF could attract up to $4 billion in capital inflows from investors within the next year. This is lower than most analysts' expectations of $4.5 billion to $6.5 billion, and about 62% less than the $17 billion attracted by Bitcoin ETFs since they began trading in the U.S. six months ago.
However, Wintermute predicts that these capital inflows could potentially drive a price increase of up to 24% for Ethereum over the next 12 months. The U.S regulatory authorities have rejected issuers' requests to allow Ethereum ETFs to pledge their held cryptocurrencies, which could generate returns and be shared with investors. "This loss has reduced the competitiveness of Ethereum ETFs relative to direct holdings, but investors can still benefit from pledges," Wintermute stated in its report. Research firm Kaiko holds a similar view based on previous releases focused on Ethereum. Will Cai, head of Kaiko Indexes said in a report: "The demand for futures-based Ethereum ETFs launched at the end of last year in the United States was lackluster. Everyone's attention is focused on launching spot ETFs hoping for rapid asset accumulation." He also noted that regardless of long-term trends, Ether's price may be 'sensitive' to amounts of capital inflow during initial days of trading.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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MoreData: If ETH falls below $3,341, the cumulative long liquidation intensity on major CEXs will reach $1.155 billions
Data: In the past 24 hours, total liquidations across the network reached $235 million, with long positions liquidated for $95.18 million and short positions liquidated for $140 million.