The recent green light from the U.S. Securities and Exchange Commission (SEC) for spot Ethereum ETFs may drive Ethereum (ETH) to new heights, according to Matt Hougan, Chief Investment Officer of Bitwise. He predicts that these ETFs will attract significant investor interest, potentially pushing ETH past its previous high of around $4,900, achieved in November 2021.

SEC Approval of Ethereum ETFs to Boost Market

This week, the SEC approved a crucial rule change, allowing spot market Ethereum ETFs. Consequently, several Ethereum ETF issuers received the regulatory nod. Hougan forecasts that this development will bring billions of dollars in investments into these ETFs. This massive influx is expected to significantly influence the market, possibly leading to new record prices for ETH.

Comparing Ethereum and Bitcoin ETFs

In a discussion on the Bankless podcast, Hougan pointed out that while Ethereum ETFs might not draw as much capital as Bitcoin ETFs, they will still see substantial investments. He highlighted that Bitcoin ETFs attracted $12 billion within the first four months of their launch. For Ethereum ETFs, he anticipates a quarter to half of this amount, reflecting strong but somewhat lesser demand compared to Bitcoin.

Future of Crypto ETFs

Hougan also sees a future where ETFs include a range of digital assets, catering to various investor interests. He envisions a market landscape featuring Bitcoin-only, Ethereum-only, and multi-asset ETFs. This variety will cater to different investor goals, from seeking high returns with Ethereum to desiring a balanced cryptocurrency portfolio.

According to Hougan, the introduction of multiple asset ETFs will be beneficial for the market overall. He estimates that approximately 30% of the market will consist of Bitcoin-only ETFs, 50% will be mixed asset ETFs, and 20% will focus solely on Ethereum. This diversity will strengthen the market, offering more choices and boosting investor confidence.

Positive Outlook for Crypto ETFs

Hougan remains optimistic about the future impact of crypto ETFs on the market. He believes that professional investors looking for high-return opportunities will find Ethereum especially appealing, further increasing demand for ETH-focused ETFs and driving Ethereum’s value higher.

The addition of diverse ETFs will likely contribute to market stability. With more investment options, the market should see greater participation and engagement. Hougan’s predictions highlight the potential for significant growth and increased stability in the cryptocurrency market as it adapts to include a broader range of ETF offerings.