Bernstein analysts Gautam Chhugani and Mahika Sapra predict lower demand for Spot Ethereum ETFs compared to Spot Bitcoin ETFs, primarily due to the absence of staking features. In a recent report, they suggest that investor enthusiasm for Spot Ethereum ETFs will be muted compared to the initial excitement for Spot Bitcoin ETFs.

Chhugani and Sapra attribute this anticipated sluggish demand to the lack of ETH staking options in the ETF filings. However, they note that the trading basis for Spot Ethereum ETFs could improve over time, potentially attracting more investors and enhancing liquidity. The suggested trading strategy involves buying Spot Ethereum ETFs and selling futures contracts, which could help sustain liquidity in the ETF market.

If Bernstein's bearish outlook proves accurate, Spot Ethereum ETFs might see significantly reduced inflows, contrasting sharply with the strong inflows observed after Spot Bitcoin ETFs launched. When the SEC approved Spot Bitcoin ETFs on January 10, investor demand drove millions in inflows within days, pushing Bitcoin to new all-time highs above $73,000.

Meanwhile, senior Bloomberg analyst Eric Balchunas expects Spot Ethereum ETFs to hit the market by July 2024, following VanEck’s recent 8-A form filing for Spot Ethereum ETFs. Balchunas predicts the launch date to be around July 2, based on previous ETF filing patterns. However, he confirmed that staking features would not be included, due to the SEC's concerns about classifying staking as an unregistered security, which could make Ethereum Spot ETFs less attractive than Bitcoin ETFs.