Global X ETFs celebrates crypto success as Ethereum ETFs enter the US market
Global X ETFs, the first provider of spot cryptocurrency ETFs across the Asia-Pacific region, welcomes the US SEC decision to introduce Ethereum ETFs, as the company approaches $25 million in assets under management in its spot Ethereum ETF product.
Global X is leading the way in Australia in digital asset ETFs, and supports regulatory developments, and subsequent product availability both locally and internationally, that underpins greater confidence in digital assets as an investable asset class.
Global X pioneered spot Ethereum and spot Bitcoin ETFs investors with its Bitcoin ETF (Cboe: EBTC) and Ethereum ETF (Cboe: EETH) on Australia’s Cboe exchange in May 2022. EETH has garnered over $24m in assets under management while EBTC has over $105m in assets under management, making it the largest spot bitcoin ETF available in Australia.
Chief Executive, Evan Metcalf said that Global X is proud to lead the way in digital assets and expects investor sentiment towards Ethereum to grow following the launch of Ethereum ETFs in the US.
“The introduction of spot Ethereum ETFs in the US signals a strong endorsement of cryptocurrency investing, and we expect it will further drive demand both domestically and abroad.
“We are already witnessing significant inflows into our spot cryptocurrency products. Drawing from historical patterns, where we saw Bitcoin ETF flows surge post-regulatory approval in the US, we expect Ethereum to follow a similar upward trend, underscoring more broadly the growing interest in digital assets as high-growth diversification tools.
“At Global X, we remain committed to delivering accessible and innovative investment solutions that meet this demand, as more investors seek exposure to cryptocurrency as part of a well-balanced portfolio,” Metcalf said.
EBTC and EETH track the price performance of Bitcoin and Ethereum in Australian dollars, before fees and expenses, offering investors exposure to the digital asset without the complexities associated with direct ownership. They provide holders access to physical cryptocurrencies held securely in cold storage by Coinbase, a trusted and regulated custodian in the cryptocurrency market. Investors can seamlessly trade the ETFs through their brokerage accounts, providing a regulated and accessible means to capitalise on Ethereum’s price movements and its growth potential.
Amid rising demand for cryptocurrency products in the Australian market, Global X recently reduced the annual management fees for its spot cryptocurrency products, EBTC and EETH, to 0.59% per annum, enabling Australian investors to access a high-growth market with greater cost efficiency.
ETH reaches target price amid Bitcoin ETF inflows: 4% change linked to every $1 billion in US ETF flows
Billy Leung, Investment Strategist at Global X, shares insights on the recent trends in US Bitcoin ETF fund inflows and their potential impact on cryptocurrency prices, including Ethereum, stating, “In the past four weeks, US Bitcoin ETF funds have experienced consistent net inflows, marking a significant trend in the cryptocurrency market. Although the correlation between these inflows and Bitcoin prices has not increased substantially over the last three weeks, the impact of these fund flows on Bitcoin price changes has become more pronounced. The data now suggests that US Bitcoin ETF fund flows account for approximately 4% of the change in Bitcoin prices, up from 3.6% since the last analysis. This means that for every US$1 billion in US ETF flows, there could be a corresponding 4% change in Bitcoin prices.
“Meanwhile, Ethereum (ETH) has reached its previously projected target price, further supporting the thesis that if ETH ETFs receive proportionate inflows, a similar relationship could be observed. Essentially, an inflow of US$1 billion in ETH ETFs could also result in a ~4% change in Ethereum prices. This pattern highlights the growing influence of ETF fund flows on cryptocurrency price dynamics and underscores the potential for further market movements driven by such financial instruments,” Leung said.
What’s driving inflows? Political Winds and Potential Policies Fuel Cryptocurrency Optimism
Billy Leung, Investment Strategist at Global X, shares insights around key economic factors driving inflows into Bitcoin and Ethereum:
While ETF flows have significantly influenced Bitcoin prices, political factors are also playing a crucial role. Former President Trump’s recent shift towards a more crypto-friendly stance, along with potential policies suggested by his advisor Vivek Ramaswamy, indicates a favourable environment for digital assets should he return to office. Historically, Trump’s administration favoured financial deregulation, which crypto advocates believe could extend to digital assets in a potential second term.
Conversely, the Biden administration has maintained a stringent stance on cryptocurrencies, emphasising regulatory measures aimed at consumer protection. Although Vice President Harris aligns with President Biden on regulatory direction, she is less vocal on cryptocurrency issues. Consequently, some market participants perceive Biden’s potential withdrawal from the presidential race as beneficial for cryptocurrency development. It is noteworthy that Bitcoin prices experienced an uptick following Biden-related news, although this might also be attributed to an unwinding of the US dollar trade.
Furthermore, Trump is scheduled to discuss Bitcoin at the upcoming Bitcoin 2024 conference on July 25th, where he may further articulate his support for digital assets and critique the current administration’s stance. This event could provide additional insights into potential policy changes and their impacts on the crypto market. Furthermore, Trump’s Vice-Presidential pick, JD Vance, is a staunch cryptocurrency supporter. He possesses a significant amount of Bitcoin and has criticised current SEC regulations. Vance’s presence could further foster a pro-crypto regulatory environment, thereby boosting investor confidence and market valuations.
