DeepSummary
The episode features Matt Hogan from Bitwise and Alex Thorne from Galaxy Digital, who provide their analysis and estimates on the expected inflows for the upcoming Ethereum ETF. They discuss factors like market cap weighting, international ETP markets, and data from the Bitcoin ETF launches to arrive at estimates of around $15 billion in net inflows over 18 months for the Ethereum ETF.
The conversation delves into the potential price impact of these inflows, with Matt and Alex suggesting that Ethereum's price could be more sensitive to inflows compared to Bitcoin due to its limited net issuance. They address concerns raised by skeptics about the appeal of Ethereum among traditional finance investors and the role of delta-neutral flows in the Bitcoin ETF numbers.
Additionally, the guests share their perspectives on the state of the broader crypto market, touching on factors like regulatory shifts in Washington, the impact of major wealth platforms embracing these products, and the multi-year trajectory of ETF inflows based on historical precedents like the gold ETFs.
Key Episodes Takeaways
- Matt Hogan and Alex Thorne independently estimate around $15 billion in net inflows for the Ethereum ETF over the next 18 months, based on factors like market cap weighting and the Bitcoin ETF experience.
- They expect the Ethereum price to be highly sensitive to these inflows, potentially more so than Bitcoin due to limited net issuance, with a path to new all-time highs.
- While acknowledging short-term uncertainties around launch, they are bullish on sustained multi-year inflows driven by institutional adoption and a shifting regulatory landscape favoring crypto.
- The ETF structure is seen as an efficient, appealing vehicle for both retail and institutional investors seeking diversified crypto exposure.
- Concerns about traditional finance disinterest and the role of delta-neutral flows are addressed, with the guests suggesting crypto's overall popularity and market dynamics will drive demand.
- Key catalysts highlighted include the onboarding of major wealth platforms, expansive regulatory tailwinds, and the macro investment case for institutions to significantly increase their crypto holdings.
- The guests contrast the current bearish sentiment with their analysis, expressing optimism for an upside surprise as inflows accelerate towards year-end.
- While short-term volatility is expected, the multi-year outlook echoes patterns seen with successful gold ETFs, with future flows outpacing the initial phases.
Top Episodes Quotes
- “I don't know what the flows will be in the second half of the year, but I expect that we'll see an acceleration as those account platforms come on and as the inevitable tailwinds behind crypto right now, which are massive, push us to new all time high prices.“ by Matt Hogan
- “I think right now, the cryptocurrency industry has more influence in policy than at any other time. And it may be more influence now than it is even if the most pro crypto White House Congress takes office.“ by Alex Thorne
- “These products are. I mean, Matt's an ETF guy. Like, I'm not really like, by trade, but like, I've grown to love them. And they are great products. They are efficient, they are transparent, they're inexpensive to operate and to own. People love eTF's. They're absolutely gobbling the asset management industry.“ by Alex Thorne
- “If you look at any other major asset, professional investors hold the majority of that asset and here we're still in a few percentage points. They have to buy trillions of dollars.“ by Matt Hogan
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Episode Information
Bankless
Bankless
7/1/24
Is the Ethereum ETF Bullish for ETH?
Matt Hougan and Alex Thorn put together their own analysis of inflows for the ETH ETF. Remarkably, their numbers came in somewhere close to the same place.
We discussed how much demand there will be for the ETH ETF, whether or not it will overperform or underperform expectations and the overall state of the Crypto Market today.
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TIMESTAMPS
0:00 Intro
2:18 When ETH ETF?
7:16 Data Gathering Process
13:59 The BTC ETF Datapoint
24:17 Estimating ETH ETF Inflows
42:19 Price Impact
52:36 The ETH ETF Bear Case
1:03:14 Solana ETF?
1:05:44 The State of the Market
1:13:53 Closing & Disclaimers
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RESOURCES
Matt Hougan
https://x.com/matt_hougan
Alex Thorn
https://x.com/intangiblecoins
Bitwise
https://bitwiseinvestments.com/
Galaxy Digital
https://www.galaxy.com/
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https://www.bankless.com/disclosures