Ethereum Spot ETFs vs. Bitcoin Spot ETFs

Ethereum (ETH) spot exchange-traded funds (ETFs) are expected to see significantly lower inflows than bitcoin spot ETFs during their first year of trading, according to analyst Katalin Tischhauser from Sygnum Bank.

Slow Adoption Forecast

Tischhauser attributes Ethereum’s slower adoption to its lesser name recognition and a market capitalization that is a third of bitcoin’s. She forecasts that relative inflows for Ethereum will be in the range of 15% to 35% compared to bitcoin, estimating $5 to $10 billion in the first year. In contrast, bitcoin spot ETFs could attract between $30 billion and $50 billion in the first 12 months.

Initial Trading Outcomes

Ethereum spot ETF trading began last Tuesday, and the products faced negative net flows, with $1.5 billion in outflows from Grayscale’s ETHE during the initial four days. Meanwhile, over $1 billion in net inflows were recorded in eight competing products, including BlackRock’s ETHA and Bitwise’s ETHW.

This compares to a total net inflow of $1.26 billion for U.S. spot bitcoin ETFs that launched in January.

Future Prospects

Currently, bitcoin ETFs have seen net inflows of $17.6 billion. Tischhauser anticipates a second wave of inflows over the next six months as various institutions finalize governance processes. She noted strong interest from large traditional institutions like sovereign wealth funds and pension funds.

As of the time of writing, Ethereum is trading at $3,318, remaining flat over the past 24 hours, according to The Block’s Price Page.