Amid the recent approvals and debuts in the U.S. of 10 spot bitcoin exchange traded funds, speculation has increased that the Securities and Exchange Commission (SEC) could soon grant similar approvals to Ethereum-linked exchange traded products.
Should that event materialize, it could potentially generate upside for funds such as the VanEck Ethereum Strategy ETF (EFUT). Perhaps helped in part by speculation that spot Ethereum ETFs will come to market and likely aided by Bitcoin’s recent rally, the actively managed EFUT is higher by more than 10% over the past week.
As things stand today, the SEC is tasked with decisions on seven spot ether ETF filings before the end of August. Deadlines on three of those filings, including one from VanEck, arrive in May. So there may be some action, one way or the other, on spot ether ETFs in the months ahead. It’s also possible that this effort might have some advantages.
ESG Could Be Meaningful to Ether ETF Effort
As the two largest cryptocurrencies by market value, it’s natural that there is a rivalry between Bitcoin and Ethereum. That implies investors should measure the advantages and disadvantages found with these assets.
In the case of Ethereum, one of its potential advantages relative to its larger counterpart is that it’s less energy-intensive to produce. Some market observers believe that enhances Ethereum’s environmental, social, and governance (ESG) credentials, potentially easing the way to approval of related spot ETFs.
“Alongside this growing institutional adoption of cryptocurrencies is increasing attention to the environmental, social, and governance (ESG) characteristics of investments. Firms have devoted billions of dollars to ESG investments, particularly in recent years,” reported Daniel Ramirez-Escudero for Coin Telegraph.
It’s not hyperbole to assume that Ethereum’s ESG resume could support the case for approval of spot ETFs. From an ESG standpoint, Ethereum is one of the leaders in the cryptocurrency space. It ranks as one of the best among the large digital currencies.
In fact, it’s possible that Ethereum is currently underappreciated as an ESG investment. It could gain more traction on that front in the coming years, thus bringing more users into the ether ecosystem.
“For 2024, Thomson Reuters Institute ESG strategist Natalie Runyon predicted that ESG will shift from being a peripheral element to a pivotal aspect of corporate business strategies. By 2025, global ESG assets are expected to reach $53 trillion,” according to Coin Telegraph. “Ether could absorb part of this investment branch if it were broadly considered an ESG asset. A spot Ether ETF would position ETH as the only ESG cryptocurrency that is an SEC-approved financial instrument.”
For more news, information, and analysis, visit the Crypto Channel.