Efe Nail Saltık 
According to Galaxy Digital’s report, Ethereum will be more sensitive to ETF inflows than Bitcoin due to the large amount of ETH total supply locked. Galaxy said spot Ethereum ETFs could see net inflows of $5 billion in the first five months.
Demand for new products is expected to come from independent investment advisors and broker/distributor platforms. The report noted that the lack of staking rewards could limit demand for these spot ETFs. Galaxy research stated in a report published on Wednesday that Ether (ETH) could see monthly net inflows of $1 billion when spot exchange-traded funds (ETFs) open for trading.
“We expect net inflows into ETH ETFs to be 20-50% of net inflows into BTC ETFs in the first five months, setting 30% as our target, resulting in net inflows of $1 billion per month,” analyst Charles Yu said. Wrote. Ether ETFs are close to opening for trading in the US after the Securities and Exchange Commission (SEC) approved applications last month. The regulator must also approve S-1 applications for these products to be commercialized. Spot bitcoin ETFs launched in the US in January.
Similar to Bitcoin (BTC) spot ETFs, new demand for ether versions is expected to come from independent investment advisors or broker/dealer platforms, the report noted. Galaxy said Ether will be more price sensitive to ETF inflows than bitcoin due to the total supply of ETH locked in staking, bridges and smart contracts, and the lower amount held on centralized exchanges. Galaxy warned that a lack of staking rewards could limit spot ether ETF demand.
Outflows from the Grayscale Ethereum Trust (ETHE) will also negatively impact ether ETF inflows, with Galaxy estimating these negative flows to be approximately 319,000 ETH, or $1.1 billion, per month. However, due to the smaller percentage of ether held in these trusts, it is stated that “the ETHE ETF conversion will put relatively smaller pressure on the ETH price than the Grayscale Bitcoin Trust (GBTC) conversion.”
Unlike GBTC, ETHE is not facing forced sales from bankruptcies like 3AC and Genesis, supporting the idea that ether will see less selling pressure than bitcoin due to Grayscale trusts, the report added.
The SEC could approve spot ether ETFs as soon as July 4, Reuters reported on Thursday.
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