Coinspeaker
Institutions Bullish on Ethereum despite Low Demand for Spot Ether ETFs
The Ethereum price has continued to trade under $2,500 with the broader market losing in the world’s largest altcoin in recent times. Besides, the massive drop in the Ethereum revenue and the low demand for the spot Ether ETFs have further resulted in this dull price action. However, institutional players continue to remain bullish on Ethereum’s future prospects.
Institutional staking firm Attestant said that the market isn’t reflecting ETH’s ETH $2 351 24h volatility: 0.9% Market cap: $283.01 B Vol. 24h: $14.30 B true value, however, a better-refined messaging could get Wall Street interested once again. Attestant’s chief business officer Steve Berryman and strategic adviser Tim Lowe said that despite the low demand for spot Ether ETFs, and other complaints of “underperformance”, they continue to remain bullish on the altcoin.
However, they added that Ethereum needs better marketing, diversification, as well as tokenomics that would reignite the appetite for the asset over a long time horizon. Bitcoin remains at the top of the mindshare for institutional investors with its value proposition of being the “digital gold”.
Lowe believes that Ethereum could grab some of this mindshare through a mix of better value proposition and refined marketing. Doing this would naturally attract institutional investors looking to diversify their digital asset holdings over time. Speaking to Cointelegraph, Lowe said:
“I think the number one, simple catalyst for Ethereum is diversification. In traditional finance, almost everyone wants to have a more diversified portfolio. We know digital assets are becoming an investable asset class for traditional investors, so it’s an easy step to say, okay, we should diversify.”
However, for this to happen, the Ethereum functionality should be more simpler for investors to understand. “At the moment Ethereum is only really going to be interesting to people that are interested – a lot of people buying Bitcoin ETFs are just looking at a digital asset that performs very well,” Lowe added.
Can Ethereum Staking Change the Game for the Ecosystem?
Berryman added that staking could be another major selling point for Ethereum on a longer horizon. Furthermore, the Ether ETF can also earn an additional 4% a year by owning ETH through a fund.
Several fund managers, including BlackRock, Fidelity, and Franklin Templeton, sought SEC approval to include staking in their ETFs but were denied. Berryman noted that while excluding staking was a necessary compromise at the time, introducing it in the future would be an ideal development for Ethereum. He added:
“It makes a lot of sense to introduce staking at some point. If you’re going to hold Ethereum, then why wouldn’t you also stake it?”
Apart from the concerns that staking could come under the US securities laws, Berryman said that another major challenge for ETF issuers was liquidity. “With these ETFs, you need to be able to get in and out quickly and there’s not a finite staking period. If there’s a long queue, then it can take a long time,” he said.
Institutions Bullish on Ethereum despite Low Demand for Spot Ether ETFs
