A multi-crypto ETF is an investment fund that holds a diversified portfolio of cryptocurrencies, such as Bitcoin ($BTC), Ethereum ($ETH), and Solana ($SOL) within a single security.
Nate Geraci, the President of ETF Store, has forecasted that an ETF issuer will soon file for a combined spot Bitcoin, Ethereum, and Solana ETF.
He highlighted the rapid progression towards index-based and actively managed crypto ETFs. This forecast aligns with evolving regulatory landscapes and increasing investor demand for diversified crypto investment options.
2024 has been a landmark year for spot crypto ETFs, which have captivated the market and attracted billions from eager investors.
The approval of spot Bitcoin ETFs on 11 January injected fresh optimism into the crypto space, paving the way for similar offerings for Ethereum.
The success of Bitcoin ETFs has not only sparked increased investor interest in Ethereum but has also driven Bitcoin prices up to $74,000.
The concept of multi-crypto ETFs is gaining traction as institutional and retail interest grows.
Bitcoin ETFs have accumulated $17 billion in inflows, while Ethereum ETFs are projected to attract $15 billion in their first year of trading.
New ETF designs and risk management methods could tackle current issues, making it easier to create hybrid ETFs that focus on well-known cryptocurrencies or specific themes.
As asset managers prepare for a move towards more varied and volatile ETF options, multi-crypto ETFs might soon become a reality.
Ethereum ETFs poised to launch
The Chicago Board Options Exchange (Cboe) recently revealed that five spot Ethereum ETFs will start trading on 23 July, pending final regulatory clearance.
This announcement follows the Securities and Exchange Commission’s (SEC) 23 May approval for listing spot Ether ETFs. The ETFs slated for launch include the 21Shares Core Ethereum ETF, Fidelity Ethereum Fund, Invesco Galaxy Ethereum ETF, VanEck Ethereum ETF, and Franklin Ethereum ETF.
To compete for market share, many issuers plan to temporarily lower or waive fees when these products become available.
The potential for Solana ETFs remains a topic of keen interest and speculation. While Bitcoin and Ethereum ETFs are progressing, Solana faces unique challenges.
Known for its rapid transaction speeds and high performance, Solana is often seen as a strong contender for future ETF inclusion.
However, regulatory hurdles could delay its approval. Despite optimism from industry figures like 21Shares co-founder Ophelia Snyder and VanEck’s Matthew Sigel, the regulatory environment poses significant barriers.
The SEC has already received Solana ETF applications, including one from 21Shares with Coinbase as the custodian.
The success of these initial ETFs shows that investors are eager for more options and managed crypto investments.
A combination of spot ETFs that include major cryptocurrencies such as Bitcoin, Ethereum, and Solana is expected to offer investors a diversified exposure to the top-performing digital assets.
Geraci further noted that the ETF industry is swiftly moving towards the adoption of both index-based and actively managed cryptocurrency ETFs.
This transition reflects a growing demand for diversified and strategically managed crypto investment options.
By combining major cryptocurrencies like Bitcoin, Ethereum, and Solana into a single ETF, investors would gain exposure to a broader range of assets, potentially reducing risk and increasing investment appeal.
The rise of crypto ETFs marks a significant shift, changing the view of crypto from just a speculative asset to a key part of investment portfolios.
More involvement from financial institutions adds credibility to crypto assets. This positive development has boosted the crypto market, with Bitcoin trading at $67,249, Ethereum hovering around $3,477, and Solana trading at $178, as of press time.
