Ethereum ETF: VanEck Anticipates Surpassing Bitcoin Demand
As the countdown to the U.S. Securities and Exchange Commission’s (SEC) decision on the approval of a spot Ethereum exchange-traded fund (ETF) nears, industry experts are assessing the potential impact of such a fund. VanEck, a global investment firm, believes that Ethereum ETFs will not only have significant demand but may even exceed the demand for Bitcoin. They are confident in their ability to make it happen.
With an aim to attract capital inflows into the fund, VanEck has decided to temporarily reduce the management fee of its Bitcoin Fund to zero. This move has generated even more anticipation around the potential Ethereum ETF.
Pranav Kanade, VanEck Portfolio Manager, is optimistic about the bright future of an Ethereum ETF and how it could rival or surpass the demand for Bitcoin ETFs. Kanade points out that Ethereum’s ability to generate fees for token holders, especially through staking rewards, could make it a more appealing asset for a broader range of investors.
Highlighting Ethereum’s cash-generating potential, Kanade stated, “From a market perspective, the market cap of the spot ETH ETF is believed to be potentially larger, if not larger, than the spot Bitcoin ETFs.”
Unlike traditional Bitcoin ETFs, Ethereum’s Proof of Stake consensus mechanism allows holders to earn returns by staking their tokens. This feature gives Ethereum an advantage in terms of generating income.
Despite these advantages, the SEC’s approval of spot ETH products remains uncertain. Bloomberg analysts estimate the probability of approval by May to be only 30%.
Disclaimer: This information is not intended as investment advice.