Ethereum exchange-traded funds (ETFs) are expected to attract up to $10 billion in new inflows in the months following their launch, potentially driving Ether prices to all-time highs by year-end, according to Tom Dunleavy, a managing partner at crypto investment firm MV Global. Dunleavy shared these insights with Cointelegraph, emphasizing that ETH’s spot price is likely to be more responsive to ETF inflows compared to Bitcoin’s (BTC).

“We saw $15 billion in inflows for Bitcoin. I think we’re probably going to see $5 billion to $10 billion for Ethereum,” Dunleavy stated. “I expect a very positive price impact, pushing us to new all-time highs by early Q4.”

Eight spot Ether (ETH) ETFs are awaiting final approval from United States regulators and are anticipated to begin trading soon, possibly as early as this month. These funds will join an existing lineup of around a dozen Bitcoin (BTC) ETFs, which have been trading since January. Currently, BTC ETFs collectively manage approximately $15.9 billion.

Dunleavy projects that ETH ETFs will attract around $1 billion per month as a “base case” for the next few months. He added that, compared to BTC, ETH is “less available on exchanges, meaning thinner order books and less to purchase,” making ETH’s spot price more sensitive to buying demand from ETFs than BTC’s.

Ether supply on exchanges is dwindling as more ETH is locked in staking contracts. Source: Coin Metrics

“The BTC ETF led to a price appreciation of 36% from the January 10th launch date to the peak and over 50% from the time of initial speculation and rumors,” Dunleavy wrote in a Q2 investor memo shared with Cointelegraph.

“We believe that there will be strong buy pressure with a much clearer narrative that traditional investors can understand. ETH has cash flows. It can be described as a tech stock, the app store of crypto, or an internet bond. This is a much easier sell for financial advisors than ‘digital gold,’” according to the memo.

So far this year, ETH’s performance has lagged behind BTC’s, experiencing relatively deeper drops during market downturns, according to data from Cointelegraph Markets Pro and TradingView. Dunleavy cautioned that a rebound in ETH’s performance may not extend to altcoins, partly due to a lack of overlap between crypto’s institutional and retail markets.

Ether ETF investors “are not going to be users who were on-chain. They’re going to be users who were holding the stuff in their 401(k),” Dunleavy explained.

Source: Cointelegraph