Spot Ethereum (ETH) ETFs Set to Launch Within a Week, According to Industry Sources

According to a Reuters report, three industry sources indicate that spot Ether exchange-traded funds (ETFs) are expected to begin trading on July 23.

The sources also mention that the U.S. Securities and Exchange Commission (SEC) has granted preliminary approval for at least three of eight asset managers to release the spot Ether ETFs.

Will Spot Ether ETFs Begin Trading Next Week?

Nate Geraci, President of the ETF Store, highlighted this development in a post on X. He noted that the SEC has given preliminary approval to at least three of the eight spot Ether ETF issuers to begin trading next Tuesday, with all eight expected to launch simultaneously.

Reuters: SEC has given “preliminary approval” to at least three of eight spot eth ETF issuers to begin trading next Tuesday…

All eight expected to launch at same time tho. https://t.co/ngACRMnjJr pic.twitter.com/BJfuqR8Ju9

— Nate Geraci (@NateGeraci) July 15, 2024

This statement followed his July 15 post, where he optimistically predicted, “Welcome to spot Eth ETF approval week… I’m calling it. I don’t know anything specific; I just can’t come up with a good reason for any further delay at this point. Issuers are ready for launch.”

Sources indicate that prominent asset managers, including BlackRock, VanEck, and Franklin Templeton, are expected to receive SEC approval by July 22, with trading anticipated to begin the following day. However, final approval for these spot Ether ETFs depends on the applicants submitting their final offering documents to the SEC by the end of this week.

The journey toward spot Ether ETF approval began in September with low initial expectations due to discouraging SEC feedback. However, the agency’s surprise approval of necessary rule changes in May and SEC Chair Gary Gensler’s acknowledgment of the Grayscale ruling’s impact set the stage for the anticipated launch.

Experts Predict More Modest Inflows

The approval of Ether ETFs follows the SEC’s earlier reluctance due to concerns over market manipulation. The agency’s stance shifted after a court challenge by digital asset manager Grayscale Investments, leading to the approval of nine spot Bitcoin ETFs in January.

According to Morningstar Direct data, these ETFs quickly gained traction, attracting approximately $6.6 billion in assets within their first three weeks of trading and achieving a net inflow of $33.1 billion by the end of June.

Martin Leinweber, digital asset product strategist at MarketVector Indexes, anticipates more modest inflows and greater price volatility for Ether compared to Bitcoin due to Ether’s smaller market size and trading volumes. According to CoinGecko data, Bitcoin’s market value stands at just over $1 trillion, while Ether’s is around $359 billion.

“It’s important to temper expectations,” Leinweber advised. Despite Ether’s smaller market size, Galaxy Research projects that spot ether ETFs could still attract monthly inflows of $1 billion. Thomas Perfumo, head of strategy at crypto exchange Kraken, added that spot Ether ETFs wouldn’t need to match spot Bitcoin ETF inflows to be considered successful.