Ethereum ETF race intensifies as Volatility Shares enters the fray

• Volatility Shares joins the ETF race along with other eager firms.
• Institutional interest in ETH grows, but whale interest in Ethereum declines.

As all eyes remain fixed on Bitcoin’s [BTC] potential ETF approval by the SEC, Ethereum [ETH] was seen positioning itself to reap the benefits of this burgeoning investment avenue.

Read Ethereum’s [ETH] Price Prediction 2023-2024

In the increasingly crowded landscape of ETF applications, Ethereum has emerged as a significant contender alongside Bitcoin. Notably, Volatility Shares has recently thrown its hat into the Ethereum ETF arena.

More players stepping in

Eric Balchunas, a prominent ETF analyst at Bloomberg, revealed that Volatility Shares slated the launch of an Ethereum futures ETF for October 12. This strategic move was unveiled through an SEC filing on July 28.

The proposed ETF, named Ether Strategy ETF (Ticker: ETHU), is set to invest in cash-settled Ethereum futures contracts. Thus, sidestepping direct investment in the cryptocurrency itself.

VolatilityShares announcing they intend to list their Ether Futures ETF on Oct 12th (which would be a day or two ahead of the rest of pack (if the 75 days is adhered to).. they did same thing w $BITX pic.twitter.com/hhFtk32f4X

— Eric Balchunas (@EricBalchunas) August 15, 2023

While this may seem like a unique approach, Volatility Shares previously made waves with the launch of the first 2x bitcoin-linked ETF (BITX) in July. This foray solidified the company’s presence in the landscape of crypto-related ETFs.

However, Volatility Shares is far from alone in this Ethereum ETF race. Other prominent financial players, including Bitwise, VanEck, Roubhill, ProShares, and Grayscale, have also thrown their hats into the ring by submitting their own applications to the US SEC.

This surge of institutional interest in Ethereum could significantly impact its trajectory. The introduction of Ethereum-focused ETFs could broaden its appeal to a wider range of investors, potentially driving demand and bolstering its value.

Whales swim away

Despite this promising institutional interest, an intriguing contrast emerged. Glassnode’s data revealed a decline in whale interest in Ethereum, with the number of addresses holding more than 10,000 ETH hitting a two-year low of 1,095.

Source: glassnode

At press time, Ethereum’s trading price stood at $1830.8 and showcased relatively sideways movement over the past week. The Market Value to Realized Value (MVRV) ratio, a key indicator of address profitability, skewed largely toward the negative. This indicated a reduced incentive for most holders to sell.

Realistic or not, here’s ETH’s market cap in BTC’s terms

The long/short ratio for Ethereum surged during the same period, indicating a growth in the number of long-term holders. This could potentially translate to fewer impulsive sell-offs by short-term holders, fostering greater price stability.

Source: Santiment