Significant Outflows Projected for Grayscale’s Ethereum ETF
Grayscale’s forthcoming spot Ethereum exchange-traded fund (ETF) is anticipated to face substantial outflows, with an estimated average of approximately $110 million per day. Analysis firm Kaiko has drawn parallels to Grayscale’s Bitcoin Trust (GBTC) conversion to an ETF on January 11, where 23% of its assets under management (AUM) flowed out within the first month, totaling $6.5 billion.
Implications of Ethereum ETF Approval on the Market
The recent approval of Ethereum ETFs is viewed as a significant development in the cryptocurrency market. This approval has paved the way for more crypto investment products, as stated by research from TD Cowen’s Washington Research Group. While the speed of approval was surprising to some, it was seen as an inevitable outcome following the green light given to Bitcoin ETFs earlier this year.
“The Ethereum ETF approval came about six months earlier than expected but was predictable after the SEC’s approval of crypto futures ETFs,” noted Jaret Seiberg, a member of TD Cowen’s team.
This Ethereum ETF approval potentially confirms Ether’s non-security status, aligning with industry experts’ views. Bloomberg ETF analyst James Seyffart highlighted this development, suggesting that it signifies the SEC’s recognition of Ether as not being a security. Seyffart further indicated that this recognition could extend to other tokens, solidifying their classification as commodities.
