An Ethereum spot ETF could unleash a new wave of capital, a potential $1 billion monthly inflow, into the crypto market according to Thomas Perfumo, Head of Strategy at Kraken.
In an interview with Bloomberg, Perfumo outlined several bullish catalysts for the crypto market in the second half of 2024, with the Ethereum spot ETF being the most significant.
Perfumo stated that the crypto market still has four big catalysts for this second half of the year, with the Ethereum spot ETF the most potent. He believes that approval to trade this product will attract attention from the broader financial community and lead to substantial capital inflows into the market.
The Kraken executive described this development as a “rising tide lifts all boats” story, suggesting that it will positively impact the entire crypto market. Another bullish catalyst Perfumo identified is the growing trend of Bitcoin adoption by institutions and traditional investors, particularly through exchange-traded funds that invest in Bitcoin.
Regarding whether the market will see significant inflows into crypto investment products for the rest of the year, Perfumo emphasized that much depends on the launch of the Ethereum spot ETF. He estimated that the market is pricing in the event, with potential monthly inflows of $750 million to $1 billion into Ethereum ETF products.
Meanwhile, during the interview, Perfumo noted that the crypto market could also benefit from the upcoming U.S. election, as it sets the tone for policymaking and the legislative agenda for the next four years. Perfumo pointed out that recent developments suggest bipartisan support in Congress.
Notably, the House recently passed the Financial Innovation and Technology for the 21st Century Act (FIT21), a bill to clarify digital asset regulation. The Senate also attempted to repeal the SEC’s controversial crypto banking rules, although President Joe Biden ultimately vetoed the resolution.
Regardless of the setback at the executive level, Perfumo remained optimistic, stating that “… even though there have been barriers at the executive level, [it is] still good progress.“
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