After the historic approval of the Bitcoin ETF, smart money bets on the ether ETF.

Ethereum (ETH) investors are encouraged by the historic U.S. approval of spot bitcoin (BTC) exchange-traded funds (ETF) on Wednesday. They are speculating that the token powering the Ethereum network may be the next in line.
Bitcoin saw a 1.3% increase in price in a day, whereas ETH saw a 10% gain. The value of layer 2 network tokens, which function as separate blockchains but are eventually constructed on top of Ethereum, increased as well. Mantle’s MNT and Arbitrum’s ARB both saw increases of over 20%. According to the category that CoinGecko tracks, other Ethereum ecosystem tokens—from meme currencies to those that support Ethereum-based applications—rose 14% on average. An ETF for spot ether is already in the works. The documents were submitted to the Securities and Exchange Commission (SEC) in September by Ark 21Shares and VanEck, the sponsors of authorized bitcoin exchange-traded funds. Additionally, an S-1 prospectus for its iShares Ethereum Trust was submitted in November by BlackRock, the largest asset manager in the world and sponsor of a bitcoin ETF.
In the last twenty-four hours, “the largest smart money inflows” have gone into the Ethereum ecosystem, according to a Telegram message from Nansen analyst Martin Lee. According to Nansen, smart money consists of wallets that trade or invest in a lucrative and deemed knowledgeable or experienced manner.
The process of creating an ETF for spot ether has already begun. Sponsors of authorized bitcoin exchange-traded funds, Ark 21Shares and VanEck, submitted the necessary documentation to the Securities and Exchange Commission (SEC) in September. In November, BlackRock, the largest asset manager globally and a sponsor of bitcoin exchange-traded funds (ETFs), submitted an S-1 prospectus for its iShares Ethereum Trust. An ether ETF, according to some traders who spoke with CoinDesk, might support the expansion of Ethereum-based financial applications. These applications have a variety of uses, from on-chain lending and trading to tokenization—the issue of real assets on the blockchain.
“A potential approval of an ether ETF could further legitimize Ethereum’s standing in the mainstream financial world, leading to increased investment and interest in Ethereum-based projects and layer 2 networks,” said RJ Ke, a researcher at Ethereum rollup service Taiko. “The anticipation could foster more innovation and growth within the Ethereum ecosystem as well.”
Investors in ETH, which underperformed bitcoin in 2023, may see a turnabout in their fortunes as a result of wagers on Ethereum-based tokens. The biggest cryptocurrency by market cap, bitcoin, increased by almost 150% last year, while the second-ranked cryptocurrency, ether, added roughly 90%.
“The approval of the Bitcoin ETFs by the SEC has opened the door for other cryptocurrencies,” said Lucy Hu, a senior analyst at Metalpha, in an email. “The market is now paying close attention to Ethereum ETF applications … As the ETH spot ETF deadline is coming close, we believe more institutional investors will allocate more ETH in their portfolios this year to capture more returns.”