Bitwise, the world’s largest crypto index fund manager, suggests that Bitcoin (BTC) exchange-traded funds (ETFs) could have a more significant market impact than their Ethereum (ETH) counterparts.
Analyst Juan Leon from Bitwise explains that while many institutional investors have become more knowledgeable about BTC, most still struggle to understand ETH’s distinct attributes. He likens BTC to a gold allocation and ETH to a high-growth tech stock.
Bitwise’s Chief Investment Officer, Matt Hougan, believes that BTC’s utility aligns better with what an ETF offers. He states, “Bitcoin’s killer app today is a way to store wealth outside of the fiat system,” whereas Ethereum’s functionality isn’t greatly impacted by an ETF.
ETH is often referred to as the “digital oil” that powers the Ethereum network, hosting complex applications like decentralized exchanges and lending services. Despite this, Leon finds that financial advisors’ understanding of ETH is limited, although they appreciate its merits, especially for staking.
Leon acknowledges the low inflows to Ethereum-based funds this year but predicts that institutional interest in ETH will increase over time. Factors such as low crypto volumes and media distraction during the launch of October’s Ethereum futures ETFs contributed to the lackluster response.
Bitwise is among several asset managers, including BlackRock and Fidelity, vying for regulatory approval for a Bitcoin spot ETF.
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