-
Initial
demand
for
the
spot
ether
ETFs
could
be
less
than
anticipated,
Wintermute
and
Kaiko
predict. -
Wintermute
sees
roughly
62%
less
inflows
over
the
next
year
than
bitcoin
ETFs
have
received
in
six
months.
A
couple
of
prominent
crypto
firms
see
a
relatively
muted
debut
from
exchange-traded
funds
that
hold
Ethereum’s
ether
(ETH).
Wintermute,
a
major
market
maker,
sees
ether
ETFs
collecting
$4
billion,
at
most,
of
inflows
from
investors
over
the
next
year.
That’s
below
the
$4.5
billion
to
$6.5
billion
expected
by
most
analysts
–
and
that
latter
number
is
already
roughly
62%
less
than
the
$17
billion
that
bitcoin
ETFs
have
so
far
collected
since
they
began
trading
in
the
U.S.
six
months
ago.
Wintermute
does,
however,
see
ether’s
price
gaining
as
much
as
24%
over
the
next
12
months,
driven
by
those
inflows.
The
ETFs
got
regulators’
final
blessing
Monday
night,
meaning
issuers
including
BlackRock,
Fidelity,
Grayscale,
VanEck,
Franklin
Templeton,
Bitwise,
21Shares
and
Invesco
can
start
offering
the
funds
and
they
can
begin
trading
Tuesday.
U.S.
regulators
balked
at
issuers’
request
to
allow
ether
ETFs
to
stake
the
crypto
they
own,
which
would’ve
generated
income
that
could’ve
been
shared
with
investors.
“This
loss
reduces
the
competitiveness
of
ETH
ETFs
compared
to
direct
holdings,
where
investors
can
still
benefit
from
staking,”
Wintermute
said
in
its
report.
Research
firm
Kaiko
shares
a
similar
outlook
based
on
previous
Ethereum-focused
launches.
“The
launch
of
the
futures
based
ETH
ETFs
in
the
U.S.
late
last
year
was
met
with
underwhelming
demand,”
Will
Cai,
head
of
indices
at
Kaiko,
said
in
a
report.
“All
eyes
are
on
the
spot
ETFs’
launch
with
high
hopes
on
quick
asset
accumulation.”
He
said
that
regardless
of
the
long-term
trend,
the
price
of
ether
will
likely
be
“sensitive”
to
inflow
numbers
in
the
first
days
of
trading.
According
to
data
tracked
by
Kaiko,
ether
implied
volatility
increased
sharply
over
the
weekend,
with
contracts
nearest
to
expiry
(July
26)
jumping
to
67%
from
59%.
“This
suggests
less
conviction
around
the
ETH
launch,
as
traders
are
willing
to
pay
higher
premiums
to
hedge
bets,”
the
report
said.
Issuers
revealed
their
expected
management
fees
in
filings
last
week,
clearing
one
of
the
last
hurdles
to
getting
final
regulatory
approval,
with
Grayscale’s
Ethereum
Trust
seeking
to
charge
investors
2.5%
while
most
other
managers
kept
fees
lower
in
the
0.15%
to
0.25%
range.
UPDATE
(July
22,
2024,
21:19
UTC):
Updates
to
note
that
the
ETFs
got
final
approval
and
can
begin
trading
Tuesday.