In an interesting turn of events, the US Securities and Exchange Commission (SEC) approved pending ETF applications last week. This historical development has led to commentary on the value and acceptability of the ether token, especially among a specific demographic.
If Bitcoin is digital gold, what is Ethereum?
Eric Balchunas, ETF analyst at Bloomberg I took to X A platform to discuss the chances of success of the Ethereum spot ETF market after the recent approval. The analyst highlighted how acceptance of the Ethereum token, especially among investors in the 60 to 80 age group (baby boomers), may pose a challenge to how well investment products perform.
According to Balchunas, one way ETF issuers may be able to penetrate the “baby boom” market is by distilling the value or purpose of ETH ETFs into a “sound, easy-to-understand morsel.” The Bloomberg analyst wondered if Ethereum had a simple selling point while pointing out that “Bitcoin is digital gold” as a typical marketing phrase that the older generation can resonate with.
Balchunas then asked in his letter:
Is there such a simple one line for the ether? If so, what is it?
There were many interesting answers from prominent figures in the cryptocurrency space. It is worth noting that cryptocurrency journalist Colin Wu called Ethereum the “Internet of Web 3.0.”
“Ethereum is like digital oil,” Adam Cochran, a prominent cryptocurrency investor and partner at venture capital firm Cinneamhain Ventures, also responded. Cochran further explained that Ethereum is the gas that powers decentralized protocols.
Staked ETH is similar to cyberbonds.
– Adam Cochran (adamscochran.eth) (@adamscochran) May 24, 2024
Meanwhile, James Check (known as CheckMatey), a lead analyst at Glassnode, pointed out that Ether has no selling point. “Ethereum still lacks promotions, despite years of attempts,” the cryptocurrency expert said. Share on X.
ETH ETF to Pave the Way for More Money: TD Cowen
While it is unclear whether Ethereum ETFs will succeed, these newly approved funds are expected to give rise to newer crypto products in the coming year. According to the research team of investment bank TD Cowen, a product containing a “basket of cryptocurrency tokens,” perhaps just Bitcoin, Ether or other tokens, could be next on the list.
However, the research group noted in its report that the recent approval of an Ethereum spot ETF does not indicate a shift in the SEC's overall stance toward cryptocurrencies. This was highlighted in Chairman Gary Gensler's recent statement against the passage of cryptocurrency legislation.
TD Coin expects the SEC to retain its Democratic majority through 2026. “We expect the agency will continue to file lawsuits against cryptocurrency exchanges that trade tokens that the agency believes are unregistered securities.” The next ETF coming in a year may be an offering…
— Wu Blockchain (@WuBlockchain) May 26, 2024
“We expect the agency to continue filing lawsuits against cryptocurrency exchanges that trade tokens that the agency believes are unregistered securities,” TD Cowen researchers said of the SEC retaining its Democratic majority through 2026.
ETH price hovers around $3,800 on the daily timeframe | Source: ETHUSDT chart on TradingView
Featured image from iStock, chart from TradingView