Ethereum ETF News: Early Launch Could Have Boosted Success

Ethereum ETF News: Zagotta Says Timing Hurt Ether ETF Growth

According to Bobby Zagotta, Bitstamp’s CEO for the Americas, the Ethereum ETFs might have performed better had they launched earlier in the year. Zagotta shared these insights at TOKEN2049, reflecting on how Bitcoin ETFs launched in January 2024 saw remarkable success compared to the Ether ETFs that launched later in July.

Zagotta pointed out that the crypto market is maturing and acting more like a traditional risk asset. The timing of Ether ETF's launch during a "burdened moment" for risk assets is seen as a reason for its underperformance.

Bitcoin ETFs Success vs. Ether ETFs Struggle

Bitcoin ETFs launched in early January 2024 and have garnered net inflows of $17.5 billion, according to data from CoinGlass. On the contrary, Ether ETFs, which began trading seven months later, have seen net outflows of over $600 million within just two months. Ether ETFs had only one-third of their trading days with positive net inflows.

Zagotta attributes this underperformance to the challenging market conditions when the Ether ETFs launched. Uncertainty surrounding the U.S. elections, regulatory issues, and broader sociopolitical factors have caused many investors to adopt a "wait-and-see" approach.

Competitive Pressure from Other Blockchains

Ethereum is also facing growing competition from other blockchain protocols such as Solana, which are gaining traction, even though they have not yet reached Ethereum's level in terms of application and volume. However, Zagotta believes that the increasing competition is making the market more challenging for Ethereum than ever before.

Optimism for the Future

Despite these challenges, Zagotta remains cautiously optimistic about the future of Ethereum and Ether ETFs. He predicts that clarity will emerge by the end of the year as the market stabilizes, and investors gain confidence. The upcoming U.S. election, regulatory developments, and interest rate decisions could lead to more "active markets" in the final quarter of 2024.

Many experts, including former Wall Street trader Nick Forster, agree that Ethereum is unlikely to hit new all-time highs this year. However, some remain hopeful that a rally could be around the corner as the market becomes more active toward the end of the year.

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