Ether (ETH) ETFs Approved by SEC, Bringing Popular Funds to Second-Largest Cryptocurrency

U.S. regulators have given final approval to cash exchange-traded funds that hold Ethereum’s ether (ETH)giving Americans access to a second major cryptocurrency through easy-to-trade vehicles.

The move caps a years-long process to get Ether ETFs approved by the Securities and Exchange Commission and follows the regulator’s approval of Bitcoin. (BTC) ETFs in January. Bundling ether into an ETF could make them more attractive to mainstream investors, as the funds can be bought and sold through traditional brokerage accounts. Since their launch in January, Bitcoin ETFs have attracted tens of billions of dollars in investment.

Approval seemed uncertain just weeks ago. But in late May, SEC officials suddenly started to engage with emerging ETF issuers after a long silence. Then, on May 23, the regulator approved a key filepaving the way for full approval with the latest decision.

The approval and start of trading of bitcoin spot ETFs in January, which became the most successful launch in the history of exchange-traded products in terms of the speed at which money flowed into them, pushed the price of the largest cryptocurrency to new all-time highs after surging more than 58% in just two months.

Some analysts predict that even though a spot ETH ETF could move the price of ether up to $6,500Inflows into these funds will not be as high as for their bitcoin-focused counterparts.

Research firm Steno Research predicts that the newly launched ETFs could generate $15 billion to $20 billion in inflows in the first year, roughly the same as Bitcoin spot ETFs in just seven months. Ethereum lacks the “first-mover advantage” that Bitcoin enjoyed and lacks a strong argument such as the belief in Bitcoin’s “digital gold” among many proponents, according to a report from the firm.

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