Ethereum spot ETFs could attract $15B by end of 2025 — Bitwise CIO
The crypto community is eagerly awaiting the launch of Ethereum exchange-traded funds (ETFs) in the United States, and some analysts believe they could attract significant capital flows into the market.
Matt Hougan, Chief Investment Officer of Bitwise, is optimistic about the potential of these investment products, predicting high returns to Ether ETFs in the first months of trading.
“Ethereum ETPs attract $15 billion in net inflows in first 18 months on market,” Hugan said in a June 26 X post analysis.
Haugan's $15 billion forecast is based on an in-depth analysis of available data, including a comparison of Ether's (ETH) market value to Bitcoin (BTC), the global crypto ETP market, the Grayscale Ethereum Trust (ETHE) conversion, and a comparison of Bitcoin ETFs. carry on business”.
The analyst expects investors to allocate to Bitcoin and Ethereum ETFs in proportion to their market capitalization.
“In the absence of other information, I expect investors to allocate to BTC and ETH ETPs in line with their earnings value: BTC: $1.266 billion (74% of the market) and ETH: $432 billion (26% of the market).”
Hugan arrives at the percentage by accumulating the market capitalization of only the two major cryptocurrencies.
“US investors have invested $56 billion in spot Bitcoin ETPs,” Haughan said, adding that he expects that figure to reach $100 billion by the end of 2025 “as these EFAs mature and are approved by platforms like Morgan Stanley.”
Using $100 billion as a benchmark and subtracting Greyscale's $10 billion Ethereum Trust into ETFs, space Ethereum ETFs could see a net inflow of $25 billion.
To confirm this figure, they examined more international ETF markets and found that Canada and Europe have a similar investment split between the two assets, with Bitcoin ETPs representing approximately 78% and Ethereum ETPs representing approximately 22% of total assets under management (AUM). ).
“The almost identical asset allocation across the two geographies suggests to me that this allocation captures the relative interest of BTC and ETH ETP investors.”
Global Ethereum ETFs only garner 22% of the combined market share compared to Bitcoin, reducing the estimate from $25 billion to $18 billion.
Finally, Hugan considered the potential impact of “carry trading,” noting that institutions don't participate in Ethereum because they don't have stakes in U.S. spot Ethereum ETFs like they do with Bitcoin ETFs.
A carry trade involves buying an asset in the spot market and shorting the counterparty in the futures market. The objective is to profit from the difference in price when the asset's futures contract sells at its current price.
To maintain a conservative estimate, Hugan excludes the $10 billion in AUM associated with carry trades when measuring the Bitcoin market, which translates to $15 billion in net revenue for Ethereum ETPs by the end of 2025.
“I think ETH ETPs will be a huge success. At least that's what the data tells me.”
Meanwhile, issuers of candidate spot Ethereum ETFs continue to finalize their registrations ahead of launch following May 23 approval by the US Securities and Exchange Commission (SEC).
Firms are filing revised Form S-1 registration statements as part of the process. According to Bloomberg ETF analyst Eric Balchunas, the SpotEther ETF is likely to begin trading in the U.S. on July 2.
On June 25, investment manager VanEyck filed an SEC Form 8-A for its spot Ether ETF, one step closer to launch.
The price of Ether will find support around $3,300
Data from IntoTheBlock shows that ETH has found support around the $3,300 interest zone. The In/Out of the Money Around Price (IOMAP) model, which shows data for addresses that bought assets in a certain price range, shows that this level is in the price range of $3,257 to $3,557, where 1.4 million ETH were previously bought. Approximately 2.73 million addresses.
Looking at the weekly chart of ETH/USD, one can see that the 20-week exponential moving average (EMA) is currently sitting here, making it a strong line of defense for the bulls.
From a technical point of view, the relative strength indicator remains in the positive region above the center line, and the price strength at 55 indicates that the market situation is still bullish.
In the short term, traders seem to be setting their Ether price targets in the $3,500 to $3,973 range.
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
