Citi Anticipates $5.4B Ethereum ETFs Inflows In Six Months, Analysts See ETH Reaching New ATHs!

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As the spot Ethereum ETFs makes its debut on the US exchanges, Citi predicts a substantial inflow volume in six months, while analysts project an Ethereum rally to a new ATH. As per a recent CNBC report, Citi expects potential inflows of up to $5.4 billion for these ETFs in the next six months, which is a substantial amount that highlights the growing interest in regulated crypto investment vehicles. This launch follows the earlier launch of spot Bitcoin ETFs which saw around $17 billion in inflows within six months. 

Analysts predict that Ethereum could reach the $5,000 mark this year as institutional money begins to flow in. Amidst the debut of spot Ethereum ETFs, ETH trades around $3,450, down over 1% in the past 24 hours. 

ETH ETFs To Push Price To ATHs!

The Bitwise Chief Investment Officer, Matt Hougan, had stated that while the US spot Ether ETFs will have a rough start, it could have a bigger impact on the asset’s price than Bitcoin ETFs did for BTC. 

While he stated that the first few weeks could be choppy due to money flowing out of the $11 billion Grayscale Ethereum Trust (ETHE), after it converts to an ETF, by the year-end he is confident that the new highs will be in,  Bitwise chief investment officer Matt Hougan wrote in a report. He added not to expect significant results immediately given the potential selling pressure similar to what spot Bitcoin faced on its launch. 

Ether ETFs To Have A Larger Impact!

Bitwise said that the money flowing into new ether spot ETFs will have a larger impact than it did for Bitcoin for three structural reasons. Ether’s short-term inflation rate is 0% and when bitcoin versions launched the network’s inflation rate was 1.7%, so there is significant demand meeting zero supply. Unlike Bitcoin miners, ETH stakers don’t have to sell, and 28% of ETH is staked and therefore off the market.

Ether spot ETFs are expected to garner $15 billion of net inflows in their first 18 months of trading, the report added.

SEC’s Take On Staking

While Hougan is optimistic about Ethereum reaching $5,000 and beyond by the year’s end, futures traders are betting on a near-term decline in Ethereum’s price.

Moreover, the SEC’s position on not allowing staking Ether within ETFs poses a potential headwind for adoption. Historically, approvals reportedly relied on the jurisdictional hook of futures trading, which, according to CNBC, Ethereum and Bitcoin lack. 

Also Read: ETH Price Remains Almost Flat After the ETF Launch: When Will the ETH Price Trigger Fresh Highs?