A new report by JPMorgan predicts lower demand for Ether spot ETFs compared to Bitcoin ETFs. While Ether could see inflows of up to $3 billion this year, this pales in comparison to Bitcoin's expected demand.
JPMorgan analysts explain this difference. Bitcoin's "first mover advantage" and established place in portfolios (often seen as digital gold) make it more attractive.
Understanding the differences between Bitcoin and Ether ETFs is critical for investors seeking to diversify their cryptocurrency portfolios. Bitcoin's market dominance and widespread popularity create a solid platform for its ETFs, making them popular among institutional investors.
Ether, on the other hand, lacks similar catalysts. While ETFs might attract up to $6 billion if staking is allowed, they currently offer no such benefit. Additionally, Bitcoin's recent halving event further bolsters its demand.
Regulatory hurdles are also a factor. Though key filings for Ether ETFs have been approved, they still await final clearance before trading begins, unlike Bitcoin ETFs that have been trading since January.
Furthermore, JPMorgan highlights characteristics of Ether that make it less appealing for institutional investors: its application token nature, lower liquidity, and smaller asset pool compared to Bitcoin. This could lead to initial outflows and downward pressure on ETH prices as speculative investors take profits from existing Ether investment options like the Grayscale Ethereum Trust.
