Spot ether (ETH) exchange-traded funds (ETFs) are anticipated to make their debut in the U.S., potentially attracting substantial net inflows. According to a recent report by Gemini, these ETFs could see inflows of up to $5 billion within the first six months of trading.
Gemini’s report highlights that combining the projected inflows with the existing assets under management (AUM) of the Grayscale Ethereum Trust (ETHE) could bring the total AUM of spot ETH ETFs in the U.S. to a range of $13 billion to $15 billion during the initial six-month period.
One of the key observations made in the report is the relative market value of ether compared to bitcoin, which currently remains near multiyear lows. The anticipated inflows into ETH ETFs could potentially enhance ether’s standing relative to bitcoin in the market.
It is expected that trading of ether spot ETFs will commence in the U.S. in the near future following the approval of initial filings by the Securities and Exchange Commission (SEC) in May. Notably, bitcoin spot ETFs were first permitted for trading in the U.S. in January of this year.
If the ether/bitcoin ratio were to revert to the median value of the past three years, a significant rally of almost 20% to 0.067 could be seen. Moreover, a return to the peak ratio of 0.087 would signify a substantial 55% surge in value.
Gemini suggests that net inflows into spot ether ETFs falling below $3 billion would be considered disappointing, especially when compared to the $15 billion inflows received by bitcoin ETFs in the first six months. In contrast, net inflows exceeding $5 billion, equivalent to a third of the bitcoin ETF level, would be viewed as a strong performance, with inflows nearing 50% or $7.5 billion representing a significant upside surprise.
Steno Research also expressed optimism in a recent report, projecting that ether could reach $6,500 later this year, driven by robust ETF inflows and other favorable market conditions.