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Ethereum: $3B+ Moved from Exchanges Post-ETF Approval

On May 29, BlackRock, the world’s largest asset manager, submitted an updated S-1 filing for its iShares Ethereum Trust (ETHA), marking a significant step towards the launch of a spot Ethereum ETF. This update came nearly a week after the US Securities and Exchange Commission (SEC) approved its 19b-4 filing, both of which are necessary for the ETF to start trading.

Spot Ethereum ETFs Could Start Trading by June

Eric Balchunas, a senior ETF analyst at Bloomberg, expressed optimism about the development. He considers it a positive sign and expects other filings to follow suit soon. Balchunas believes that an end-of-June launch is a “legit possibility”. However, he still estimates the odds of approval around July 4, considering an earlier approval a “long shot”.

Another Bloomberg ETF analyst, James Seyffart, said that BlackRock’s updated S-1 is “almost certainly the engagement we were looking for”. He added that it shows “issuers and SEC are working towards spot Ethereum ETF launches.”

BlackRock Discloses Seed Capital Investor for iShares Ethereum Trust

In the revised form, BlackRock revealed details about its seed capital investor- the entity that allocates money to the fund so it can start trading.

The filing said:

On May 21, the investor, a BlackRock affiliate firm, “agreed to purchase $10,000,000 in Shares on May 21, 2024, and on May 21, 2024 took delivery of 400,000 Shares at a per-Share price of $25.00,.”

The filing also mentioned that the ETF would be listed and traded under the ticker symbol “ETHA.”

Spot Ethereum ETF Approval to Influence Price

Analysts predict that the launch of ETH ETFs will push the price of ETH to unprecedented levels, as some view it as a Wall Street bet on the growth of Web3. However, there are also speculations about potential downward pressure on ETH due to the Grayscale Ethereum Trust (ETHE). As the ETHE transitions and its discount decreases, analysts predict average daily outflows of roughly $110 million for several weeks.

Meanwhile, research from TD Cowen’s Washington Research Group suggests that the recent approval of Ethereum ETFs has expanded opportunities for additional crypto investment products. Although the speed of approval surprised some, the research group regarded it as an inevitable consequence following the approval of BTC ETFs earlier this year.

Jaret Seiberg from TD Cowen wrote:

“This comes about six months faster than we expected…yet this decision was also inevitable once the SEC approved crypto futures ETFs.”

BlackRock’s IBIT Overtakes GBTC as the World’s Biggest Bitcoin ETF

BlackRock’s iShares Bitcoin Trust, known as IBIT, has reportedly surpassed the Grayscale Bitcoin Trust (GBTC) as the world’s largest exchange-traded fund tracking the price of BTC.

According to data from HODL15Capital and the Apollo Bitcoin Tracker, the inflow reportedly increased BlackRock’s spot Bitcoin ETF holdings to a total of 288,670 Bitcoin. Meanwhile, Grayscale, which initially held 620,000 Bitcoin at the time of its conversion in January, now holds 287,450 Bitcoin.

A May 29 report from Bloomberg, stated that the fund held $19.68 billion of Bitcoin as of Tuesday. In comparison, Grayscale held $19.65 billion. Fidelity’s ETF offering lagged behind at $11.1 billion.

Read More: BlackRock Adds $4.1M of its IBIT Spot Bitcoin ETF to Income and Bond Funds