Ethereum ETF Approved by SEC, Opening Investors Access to Second Most Popular Cryptocurrency

Bittime – The Securities and Exchange Commission (SEC) has finally given the green light to an Ethereum ETF. This decision allows US investors to invest in the second largest cryptocurrency via ETFs.

The following is a complete explanation.

Long Ethereum ETF Approval Process

The Ethereum ETF approval process takes years. Previously, the SEC had approved a Bitcoin ETF last January.

ETFs offer conventional investors the convenience of investing in Ethereum because they can be bought and sold through traditional brokerage accounts. Since its launch, Bitcoin ETFs have attracted tens of billions of US dollars in investment funds.

Just a few weeks ago, approval of an Ethereum ETF was still in doubt. However, in late May, the SEC surprisingly began interacting with previously siled ETF issuers.

Ultimately, on May 23, the SEC approved the landmark filing, paving the way for the full approval that is taking place today.

Check Today's Crypto Market:

Ethereum ETFs Welcomed

“We have now fully entered the era of ETFs for crypto,” said Matt Hougan, chief investment officer at Bitwise. "Investors can now access more than 70% of the liquid crypto asset market via low-cost ETPs (Exchange Traded Products)."

Ethereum ETF issuers welcomed this decision. "As the first to file for an Ethereum ETF in 2021, we believe investors should have access to Ethereum through an easily accessible and familiar instrument," said Kyle DaCruz, head of digital assets at VanEck.

"If Bitcoin is considered digital gold, then Ethereum is the open-source App Store and gateway to thousands of applications that will leverage blockchain technology."

Read Also: Grayscale Revisi Rate dan Fee Ethereum Mini Trust

Impact on Ethereum Price

The launch and trading of the Bitcoin ETF last January was recorded as the most successful in the history of ETF products. Bitcoin prices also soared to new record highs, rising more than 58% in just two months.

Some analysts predict that an Ethereum ETF could push the price of ETH up to $6,500. However, they also predict that the flow of funds into this ETF will not be as high as the Bitcoin ETF.

Estimated Funding of $20 Billion in First Year of Ethereum ETF

Research firm Steno Research estimates that the newly launched Ethereum ETF will attract $15 billion to $20 billion in funds in its first year.

That figure is about the same as what the Bitcoin ETF produced in just seven months.

Ethereum is seen as not having a “first mover advantage” like Bitcoin and also not having a strong narrative like the “digital gold” moniker attached to Bitcoin.

Nonetheless, the approval of this Ethereum ETF is a big step for widespread crypto adoption. US investors now have a safer and more regulated investment option to engage in the rapidly growing Ethereum market.

Also Read How To Buy Crypto:

The Future of Ethereum ETFs and Crypto Markets

While the approval of an Ethereum ETF is welcome, there are several things to consider regarding the future of this instrument and the crypto market as a whole:

1. Potential for Increased Volatility

Ethereum ETFs can attract new investors who are unfamiliar with the volatility of the crypto market. Frequent price fluctuations can make investors panic and make sudden sales, thereby impacting Ether price stability.

2. Evolving Crypto Regulations

The approval of an Ethereum ETF shows the regulator's increasing openness to crypto assets. However, crypto regulations are still evolving. Future regulatory changes could impact ETFs and the crypto market as a whole.

3. Growth of the Ethereum Ecosystem

Ethereum's utility and adoption as a blockchain-based application development platform (dApps) could be a major driver of Ether's price.

Ethereum's success in attracting developers and innovative dApps projects will have a positive impact on Ether's long-term value.

4. Competition from Bitcoin ETFs

Bitcoin still dominates the crypto market with a much larger market capitalization than Ethereum. Established Bitcoin ETFs may continue to be investors' primary choice, limiting the flow of funds to Ethereum ETFs.

Read Also: Cboe Launches Ethereum ETF Spot

Conclusion

The Ethereum ETF marks an important milestone in the history of crypto adoption in the United States. This instrument offers convenience and security for investors to invest in Ethereum.

However, the future of Ethereum ETFs and the crypto market as a whole is still influenced by several factors, such as market volatility, regulation, growth of the Ethereum ecosystem, and competition from Bitcoin ETFs.

Investors need to pay attention to these developments before making investment decisions.

How to Buy Ethereum (ETH) on Bittime

You can buy and sell Ethereum (ETH) easily and safely through Bittime. Bittime is one of Indonesia's best crypto applications, officially registered with Bappebti. 

Ethereum (ETH) is available on Bittime with the market pair ETH/IDR. To be able to buy ETH IDR Of Bittime. Make sure you have registered and completed identity verification. Apart from that, also ensure you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application. 

Study Complete guide on how to buy Ethereum (ETH) on Bittime. 

Monitor graphic movement of Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and other cryptos to find out today's crypto market trends in real-time on Bittime.