Ethereum Could be the Next Cryptocurrency to Secure ETF Spot, Says Wealth Management Firm
In a recent research paper, wealth management firm Bernstein suggested that Ethereum (ETH) may be the next digital asset to secure a spot exchange-traded fund (ETF) after Bitcoin (BTC). The paper discusses Ethereum’s prospects, focusing on staking rewards, potential institutional inflows, and the possibility of an ETF approval.
Bernstein’s report indicates that Ethereum could become the only other cryptocurrency, alongside Bitcoin, to have a spot ETF. This comes after several firms have made attempts to secure approval for a spot Ethereum ETF. Analysts at the firm estimate a 50% chance of an ETH ETF approval by May, with an almost certain probability by the end of the year.
The interest in an Ethereum ETF has been growing, especially since the approval of Bitcoin spot ETFs by the US Securities and Exchange Commission (SEC). Bloomberg analyst James Seyffart predicts that a decision may be made on May 23, with companies such as BlackRock, VanEck, Hashdex, and Grayscale seeking the SEC’s approval. Franklin Templeton has recently joined the race for an ETH ETF approval as more investors turn their attention to the second-ranked cryptocurrency. However, according to Cathie Wood, the CEO of ARK Invest, the SEC is unlikely to approve more ETFs outside of Bitcoin and Ethereum.
One of the factors boosting Ethereum’s adoption is its proof-of-stake consensus mechanism, which allows validators to earn yield by staking ETH. Despite Bitcoin’s recent surge in growth, many remain optimistic about ETH’s growth prospects, especially if it follows in Bitcoin’s footsteps with an ETF approval. Last year, institutional firms recognized Ethereum’s high growth potential, as seen in a survey conducted during a period of significant institutional outflows from Ethereum. Furthermore, Coinbase’s market research highlights the building momentum for Ethereum as more companies aim to establish a spot ETF.
Currently, ETH is trading at $2,912, with a 7.2% growth in the last seven days. As the digital asset market continues to evolve, investors are eagerly watching for developments regarding Ethereum’s potential ETF approval.
Analyst comment
Positive news. The report suggests that Ethereum may secure a spot ETF, potentially becoming the second cryptocurrency after Bitcoin to do so. There is a 50% chance of approval by May and near certainty by the end of the year. This news could boost Ethereum’s adoption and drive further growth.
