Bitwise CIO Matt Hougan has projected that forthcoming spot Ethereum exchange-traded funds (ETFs) will attract $15 billion in net inflows within their initial 18 months of trading.

Hougan made this prediction on June 26, drawing upon Ethereum’s market capitalization relative to Bitcoin, insights from international ETP markets, and the potential impact of the carry trade strategy.

However, he acknowledged the likelihood of net outflows from the ETH ETPs post-launch, citing instances where traders aggressively redeemed positions from Grayscale Ethereum Trust (ETHE) after Bitcoin ETFs debuted in January.

Despite potential initial challenges, Hougan expressed confidence in the success of Ethereum ETPs, emphasizing Ethereum's strong historical performance as an underlying asset.

Hougan anticipates that investors will allocate funds to spot Bitcoin and Ethereum ETFs in proportion to their current market caps of $1.26 trillion and $432 billion, respectively. This suggests a weighting of approximately 74% for Bitcoin ETFs and 26% for Ethereum ETFs.

He projected that assets under management (AUM) for US spot Bitcoin ETFs could reach at least $100 billion by the end of 2025 as these products mature and gain broader platform approval.

To achieve parity, Hougan estimated that Ethereum ETFs would need to attract $35 billion in 18 months, factoring out Grayscale Ethereum Trust’s $10 billion AUM to a revised target of $25 billion.

Analyzing data from European and Canadian Bitcoin and Ethereum ETP markets, Hougan observed similar asset allocation patterns reflecting relative investor demand for Bitcoin and Ethereum. He adjusted his projected net flows for Ethereum ETFs from $25 billion to $18 billion based on these international market dynamics.

Regarding the carry trade strategy, which exploits differences between spot and futures prices, Hougan noted its significant impact on Bitcoin ETF flows but minimized its potential influence on Ethereum ETFs due to different market dynamics.

In conclusion, Hougan revised his estimate for net inflows into spot Ethereum ETFs to $15 billion, highlighting this figure as a historically significant achievement given recent ETF launches.