According to CoinDesk, as the deadline for a decision on the approval of a spot ether ETF by the U.S. Securities and Exchange Commission (SEC) approaches, industry experts are debating the potential uptake of such a fund. Some argue that investing in an ether ETF wouldn't make sense as these funds likely won't allow staking reward distribution, and investors would be better off buying and staking their own ether (ETH). However, VanEck, the global investment firm whose Bitcoin Trust (HODL) is among the 10 spot bitcoin ETFs that became available earlier this year, believes an ether ETF could attract huge demand.
VanEck Portfolio Manager Pranav Kanade said, "From a market perspective, part of me believes that the market size for a spot ETH ETF is potentially as big if not bigger than the spot bitcoin ETFs." He explained that even if an ETF doesn't offer staking as part of it, ether is still a cash-producing asset, making it more appealing to some investors than bitcoin. However, the odds of SEC approval for spot ETH products are far from certain, with analysts at Bloomberg recently lowering the chances of a regulatory green light to just 30%. Kanade places the odds at closer to 50%.
VanEck, which has over 68 ETFs under its umbrella, temporarily cut the management fee on its Bitcoin Trust from 0.2% to 0% earlier this week. The 0% fee will remain in place until March 2025 or the fund reaches $1.5 billion in assets under management (AUM). The move has been successful so far, with the fund's AUM increasing to more than 7,200 bitcoin and $527 million. VanEck CEO Jan Van Eck aspires to have crypto make up 15% of the firm's AUM base in the future.
