Ethereum ETF Listing Imminent: Can ETH Follow BTC's Rally? In-Depth Analysis of Approval Progress and Capital Potential

Ethereum ETF Listing Imminent: Can ETH Follow BTC's Rally?

With the U.S. Securities and Exchange Commission (SEC) advancing the approval process for spot Ethereum ETFs, the cryptocurrency market is closely watching this milestone. Following the successful listing of Bitcoin spot ETFs in early 2024, which propelled BTC past $100,000, investors are now debating whether Ethereum can replicate that surge. This article examines the approval progress, market expectations, capital inflow potential, and price trend comparisons.

I. SEC Approval Progress: From Hesitation to Acceleration

According to Reuters, the SEC unexpectedly approved 19b-4 forms for spot Ethereum ETFs submitted by multiple asset managers in May 2024, marking a critical breakthrough in the approval process. Although the final S-1 registration statements still need to take effect, the market widely expects the first products to officially launch within weeks. This shift is interpreted as a further softening of the regulator's stance on cryptocurrencies, especially after the successful operation of Bitcoin ETFs, which increased pressure from industry and lawmakers on the SEC.

Notably, SEC Chairman Gary Gensler had previously hinted that Ethereum might be considered a security, but the final approval suggests regulators lean toward classifying it as a commodity. This classification is crucial for Ethereum's long-term compliance and paves the way for other altcoin ETF applications.

II. Bitcoin ETF Performance After Listing: Will History Repeat?

After Bitcoin spot ETFs were approved in January 2024, the market experienced typical "buy the rumor, sell the news" volatility. According to CoinShares data, net inflows exceeded $1.5 billion in the first week of listing, followed by profit-taking in subsequent weeks. However, as institutional investors continued to allocate through ETF channels, Bitcoin broke through $100,000 by the end of Q2 2024, hitting an all-time high. This trend suggests that the compliance and liquidity improvements brought by ETFs ultimately drove the long-term price center higher.

In comparison, the timing of Ethereum ETF listings is more favorable: the market has already digested the impact of Bitcoin ETFs, and the Ethereum network completed the Dencun upgrade in 2024, significantly reducing Layer2 transaction fees and boosting ecosystem activity. Therefore, Ethereum ETFs may not experience the sharp volatility seen in the early days of Bitcoin ETFs, but rather a smoother capital inflow.

III. ETH Price Trends and Capital Inflow Potential

From a valuation perspective, Ethereum's market cap is about 30% of Bitcoin's, but its on-chain total value locked (TVL) and active developer count lead the industry. According to DefiLlama data, Ethereum's ecosystem TVL exceeds $60 billion, accounting for over 60% of the entire DeFi market. After ETF listing, institutional funds are expected to directly allocate to ETH through compliant channels, rather than via discounted products like the Grayscale Ethereum Trust (ETHE). Analysts estimate that net capital inflows for Ethereum ETFs could range between $500 million and $1 billion in the first month, lower than Bitcoin ETFs' initial performance, but given ETH's relatively lower liquidity, its marginal impact on price may be more significant.

Additionally, Ethereum's staking mechanism offers investors an extra source of returns. Although ETF products themselves may not directly participate in staking, market expectations of staking yields enhance ETH's holding appeal. In contrast, Bitcoin lacks a similar yield-generating function, giving ETH a differentiated advantage in institutional asset allocation.

IV. Risks and Challenges: Regulation and Competition Coexist

Despite the optimistic outlook, Ethereum ETFs face multiple risks. First, final SEC approval remains uncertain, especially if regulators question ETH's "commodity" status, which could delay listings. Second, the rise of competitors like Solana and Avalanche is diverting Ethereum's ecosystem share. According to CoinGecko data, Ethereum's DEX trading volume share dropped from 70% in 2023 to about 55% in 2024, indicating intensifying competitive pressure.

Moreover, macroeconomic changes cannot be ignored. The Federal Reserve's stance on maintaining high interest rates in 2024 may dampen risk asset appetite, and the correlation between the cryptocurrency market and U.S. tech stocks is strengthening. If the U.S. economy shows signs of recession, capital inflows into Ethereum ETFs may fall short of expectations.

V. Conclusion: Rally Continuation Requires Time to Verify

Overall, the listing of Ethereum ETFs will provide a new capital entry point for ETH, likely driving prices upward in the short term, but the gains may not match the explosive growth seen in the early days of Bitcoin ETFs. In the long run, whether ETH can follow BTC's rally depends on continued innovation in the Ethereum ecosystem, increased institutional adoption, and improved macro liquidity. Investors should focus on actual capital flow data after ETF listings rather than blindly chasing gains.

Risk Warning: The above content is for reference only and does not constitute investment advice. The cryptocurrency market is highly volatile; please fully understand the risks and make decisions based on your own risk tolerance before investing. Data cited in this article comes from public market information, and its accuracy or completeness is not guaranteed.