Crypto ETFs: Ether Not an Either/Or Story With Bitcoin

Some may love crypto and some may hate it, but cryptocurrencies have undeniably shaken up the financial markets. That excitement has spread into the ETF world, which marked a perfect union between cryptocurrency (the new digital frontier) and ETFs (which are typically on the edge of innovation). The launch of spot bitcoin ETFs seemed like a major milestone in this saga. But excitement did not die down after the launch, and talk about spot ether ETFs have kept the momentum going.

Many (including myself) believed the spot ether approval would receive relatively little attention. But the current environment has led to continued enthusiasm. Bitcoin prices have surpassed their 2021 peak and are now around $70,000, Roaring Kitty is back, and technology/artificial intelligence has revitalized interested in riskier growth assets. Interest does not always lead to investment. But investors may be ready for something new and exciting. Here’s a rundown on spot ether ETFs and what investors need to consider before investing.

Higher bitcoin prices and crypto ETF launches have complemented each over

Spot ether ETFs supported by excitement surrounding cryptocurrency

Crypto has had its highs and lows, and the crypto ETF market has also experienced the same. In 2021, interest in bitcoin and other cryptocurrencies coincided with the launch of several crypto equity ETFs, and eventually bitcoin futures ETFs. At the time, this was the closest to spot bitcoin ETF investors could get in the U.S. But hope for potential approval was weak given Grayscale’s issues with the SEC.

Soon after, in late 2022 and early 2023, crypto ETF market excitement died down along with the price of bitcoin. Several crypto ETFs announced closures and it had been several months since a launch. Finally in August, bitcoin excitement returned around the time Grayscale won its case against the SEC. From here, there was a whirlwind of “good news.” That included the launch of ether futures ETFs in October 2023 and the long-awaited spot bitcoin ETFs launch in January 2024.

Thoughts about spot ether ETF approval were mixed. But the SEC approved 19b-4 proposals for eight spot ether ETFs on May 23, 2024. These are expected to launch within weeks to months. (But assuming a similar timeline as spot bitcoin ETFs, likely within the next 90 days.)