Ethereum fund management is currently considered a more attractive investment than spot ETH ETFs in the United States.
The net asset value (NAV) of Ethereum managed funds has begun to stabilize and maintain above 1, allowing for better utilization of ETH price appreciation along with staking rewards and ETH growth per share.
MAIN CONTENT
Ethereum managed funds have NAV multiples above 1, higher than spot ETH ETFs.
Ethereum funds hold 1.6% of the total circulating ETH since June, equivalent to ETH ETFs in the United States.
It is forecasted that Ethereum funds will increase their holdings to 10% of the total ETH supply in the near future.
How does the value of Ethereum cryptocurrency managed funds compare to spot ETFs?
Geoffrey Kendrick – Head of Global Digital Asset Research at Standard Chartered Bank – stated that Ethereum fund management companies are now considered very worthy investments, even more so than spot ETH ETFs in the United States. This is due to the NAV multiples of these fund companies stabilizing and expected to remain above 1.
As a result, Ethereum fund companies can directly benefit from the price increase of ETH as well as staking rewards and ETH growth per share. Meanwhile, spot ETH ETFs in the United States cannot stake or participate in DeFi, creating a difference in potential value between the two investment types.
What is the importance of NAV multiples in evaluating ETH managed funds?
NAV multiples reflect market value compared to the value of ETH held by the fund. When NAV multiples are above 1, the fund is valued higher than the underlying ETH assets, demonstrating confidence and investment appeal.
When NAV multiples normalize and maintain above this threshold, investors have the opportunity to benefit from both ETH price appreciation, staking rewards, and ETH growth per share – factors that are not available in spot ETFs.
How has the Ethereum managed fund experienced significant growth in ETH holdings?
Since June, Ethereum managed funds have purchased up to 1.6% of the total circulating ETH, matching the buying rate of ETH ETFs in the United States during the same period.
This is a sign that capital inflows into ETH managed funds are increasingly strong and stable, helping to enhance their position in the cryptocurrency market and laying the groundwork for further growth.
What is the projected growth of ETH holdings by managed funds in the future?
Kendrick previously forecasted that the proportion of ETH holdings by managed funds could reach 10% of the total circulating ETH, equivalent to a tenfold increase compared to the current level at that time.
This growth not only reflects a positive trend in cryptocurrency asset management but also demonstrates strong confidence in the prospects of Ethereum and related mechanisms such as staking or DeFi.
“Ethereum fund management companies currently possess superior potential due to their broader utility compared to spot ETFs, from staking to participating in the DeFi ecosystem.”
Geoffrey Kendrick, Head of Global Digital Asset Research, Standard Chartered Bank, August 2024
Frequently Asked Questions
What is an Ethereum managed fund?
These are companies specialized in investing in and managing ETH assets, taking advantage of staking opportunities, price appreciation, and product development.
Why are NAV multiples above 1 a good sign?
NAV multiples above 1 means that the market value of the fund is greater than the underlying ETH assets, indicating that the fund has good performance and potential.
What are the limitations of spot ETH ETFs compared to managed funds?
Spot ETH ETFs cannot stake or participate in DeFi, thus missing out on similar rewards and growth opportunities as Ethereum managed funds.
What is the current proportion of ETH holdings by managed funds?
Currently, managed funds have purchased 1.6% of the total circulating ETH since June 2024.
What percentage of the total ETH supply is projected for Ethereum managed funds in the future?
It is projected that Ethereum managed funds could hold up to 10% of the total circulating ETH, a significant increase from the current level.
Source: https://tintucbitcoin.com/ethereum-vuot-troi-so-voi-spot-etf-my/
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