It's a historic week for the cryptocurrency markets with the emergence of Ether spot exchange-traded funds.
Franklin Templeton is one of nine exchange-traded fund companies that received approval Tuesday from the Securities and Exchange Commission.
The company is behind the Franklin Ethereum ETF (EZET) — which is now down about 10% since inception as of Thursday’s close. The sell-off in cryptocurrencies has taken its toll.
“We think they’re going to be a big hit,” David Mann, the firm’s head of exchange-traded fund products and capital markets, told CNBC’s “ETF Edge” on Tuesday. “They’re unlikely to get as much of the assets … but it’s still great.”
VanEck, a global investment management firm, is behind the VanEck Ethereum ETF (ETHV) which has also received approval.
CEO Jan van Eck expects ether ETFs to help investors diversify their investments, but he sees a different level of power for ether ETFs.
“I don’t think they will have the same success (as Bitcoin ETFs),” Van Eck said.
His new fund has also fallen sharply since Tuesday.
In the long term, Morningstar's Ben Johnson sees spot ETF volumes in ether as normal because they are roughly proportional to the relative market cap of ether versus Bitcoin.
“There’s a healthy appetite, healthy volume, healthy demand out there,” said the research firm’s head of client solutions. “(ETFs) open up access to new markets and new parts of the investment opportunity set available to investors and put that in a cost-effective package. It’s convenient and in line with the way more investors are building their portfolios these days.”
ether Ethereum’s value fell sharply on Thursday. By market close, it was down about 11% for the week. However, Ethereum is still up 38% so far this year.
