Ethereum ETFs Are Expected to Draw About 33% of Bitcoin ETF Inflows: Galaxy Digital

  • The cryptocurrency company Galaxy Digital is projecting the relative performance of Ethereum (ETH) and Bitcoin (BTC) exchange-traded funds (ETFs).

The vice president of research at the company, Charles Yu, recently published a blog post predicting that Ethereum ETFs will receive about one-third of the inflows seen in comparable Bitcoin products.

According to Yu, the firm analyzed the market capitalization of the two assets, open interest levels and volume in futures markets, and the total assets under management (AUM) of all currently operating funds to arrive at their estimate.

Based on the aforementioned, we predict that US spot bitcoin ETF inflows will be roughly three times higher than ether spot ETF inflows, with a range of two to five times, in accordance with the cap multiple. Put another way, we estimate that inflows into US spot bitcoin ETFs might be 33% of the size of ether spot ETF inflows, with a 20% to 50% range in dollar amounts.

If this multiple is applied to the $15 billion in bitcoin spot ETF inflows until June 15, this implies that monthly ETH ETF inflows for the first five months after the ether ETF launch and approval will be approximately $1.0 billion (monthly average: $600 million to $1.5 billion).

Yu goes on to say that there should be three primary reasons why ETH ETFs should generally have a beneficial effect on the ETH markets.

(i) increased accessibility for all income levels,

(ii) increased acceptance as a result of official recognition from authorities and reputable financial services companies. An ETF makes it possible for institutions and ordinary investors to reach a bigger audience, distributes funds via more channels, and strengthens the argument for using ether in a portfolio across a variety of investing methods.

Plus, faster investments and technological adoption would be the ideal outcome of financial professionals having a better understanding of Ethereum.

Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.

Author: Puskar Pande

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