In an interesting development, the U.S. Securities and Exchange Commission (SEC) last week approved a pending Ethereum spot ETF application. This breakthrough has led to commentary on the value and acceptability of Ether tokens, especially among certain demographic groups.
If Bitcoin is digital gold, then what is Ethereum?
Eric Balchunas, ETF analyst at Bloomberg, took to the X platform to discuss the potential success of the Ethereum spot ETF market following its recent approval. The analyst highlighted how the acceptability of Ethereum tokens, especially among investors in the 60-80 age group (baby boomers), could pose challenges to the performance of the investment product.
According to Balchunas, one way ETF issuers can penetrate the “baby boomer” market is by distilling the value or purpose of the ETH ETF into “easy-to-understand sound bites.” A Bloomberg analyst questioned whether Ethereum has a simple selling point, citing “Bitcoin is digital gold” as an exemplary marketing line that older generations can relate to.
Balchunas asked in his post:
Does such a simple one-liner exist in Ether? So what is it?
Some of the biggest names in the cryptocurrency industry have given some interesting answers. In particular, cryptocurrency journalist Colin Wu called Ethereum the “Web 3.0 Internet.”
“Ethereum is like digital oil,” said Adam Cochran, a well-known cryptocurrency investor and partner at venture capital firm Cinneamhain Ventures. Cochran further explained that Ethereum is a gas that powers decentralized protocols.
Staked ETH is like an internet bond.
— Adam Cochran (adamscochran.eth) (@adamscochran) May 24, 2024
Meanwhile, Glassnode senior analyst James Check (known as CheckMatey) suggested that Ether has no selling point. “Ethereum still doesn’t have an elevator pitch despite years of attempts,” the cryptocurrency expert wrote in a post on X.
ETH ETF to unlock more funds: TD Cowen
It’s unclear whether the Ethereum spot ETF will succeed, but the newly approved fund is expected to introduce even more new cryptocurrency products over the next year. A product containing a “basket of cryptocurrency tokens,” perhaps Bitcoin and Ethereum or other tokens, could be next, according to a research team at investment bank TD Cowen.
However, the research group noted in its report that the recent approval of the Ethereum spot ETF does not signal a change in the SEC’s overall stance on cryptocurrencies. This was highlighted in Chairman Gary Gensler’s recent statement opposing the passage of cryptocurrency legislation.
TD Cowen predicts the SEC will maintain a Democratic majority until 2026. “We expect that institutions will continue to file lawsuits against cryptocurrency trading platforms that trade tokens they believe are unregistered securities.” The next ETF to launch within a year may be a proposition…
— Wu Blockchain (@WuBlockchain) May 26, 2024
“We expect the agency will continue to file lawsuits against cryptocurrency trading platforms that trade tokens they believe are unregistered securities,” researcher TD Cowen said of the SEC retaining a Democratic majority until 2026.
ETH price hovers around $3,800 on the daily timeframe | Source: ETHUSDT chart on TradingView
Featured image from iStock, chart from TradingView