Ethereum ETFs Approved, Will Ether’s Price Increase?

US regulators have given final approval to spot exchange-traded funds holding Ethereum’s ether (ETH), making it easier for Americans to access the second-largest cryptocurrency.

The decision caps a years-long process to get ether ETFs approved by the Securities and Exchange Commission and comes after the regulator approved bitcoin (BTC) ETFs in January. Bitcoin ETFs have attracted tens of billions of dollars in investment since their launch in January.

“We have now fully entered the ETF era of crypto,” said Matt Hougan, chief investment officer at Bitwise. “Investors now have access to over 70% of the liquid crypto asset market through low-cost ETPs.”

“As the first to file for an Ethereum ETF in 2021, we have long believed that investors should have access to ether through a tool they are familiar with,” said Kyle DaCruz, head of digital assets at VanEck. “If Bitcoin is digital gold, Ethereum is the open-source App Store, the gateway to thousands of apps that will leverage blockchain technology.”

The approval and start of trading of spot bitcoin ETFs in January, which became the most successful launch of exchange-traded products, sent the price of the largest cryptocurrency to all-time highs after increasing by more than 58% in just two months.

Some analysts predict that while spot ETH ETFs could push the price of ether to as high as $6,500, inflows into these funds will not be as high as their bitcoin-focused counterparts.

Research firm Steno Research predicts that newly launched ETFs could see inflows of $15 billion to $20 billion in the first year, about the same amount that spot bitcoin ETFs have taken in in seven months. The firm’s report says ether lacks the “first-mover advantage” that bitcoin has and lacks a strong narrative, such as the belief among many supporters that bitcoin is “digital gold.”