Bitwise predicts Ethereum will rise above $5,000 after launching Ether-based ETF

Bitwise Investment Director Matt Hougan believes that the price of Ethereum is capable of updating its all-time high and rising above the $5,000 mark after the launch of an Ethereum-based ETF. The crypto enthusiast suggested that the influx of investment in the new product will be a key catalyst for the growth of the asset price.

“I am confident that new highs will be reached by the end of the year. And if ETH-ETF flows are stronger than many experts expect, the price could rise even higher than $5,000,” said the top manager at Bitwise.

He pointed out that Ethereum validators do not need to sell their coins to maintain operations, unlike BTC miners. About 40% of ETH in circulation is locked in staking and smart contracts, which means it is not on the market. According to Hougan’s forecast, ether-based spot exchange-traded funds will attract about $15 billion in the first year and a half after launch.

SEC Commissioner Esther Pierce said she is open to discussing the possibility of obtaining staking approval in future Ethereum ETF applications. She noted that regulatory pressure has prompted potential issuers of ETH-based ETFs, such as ARK21 Shares and Fidelity, to abandon staking due to their inability to meet the stringent requirements of the US Securities and Exchange Commission.

Let us remind you that the SEC considers staking an investment contract, under which investors invest their funds and expect profit based on the results of the work of network validators. According to Pearce, a ban on staking against the backdrop of the emergence of exchange-traded spot funds could trigger the withdrawal of a significant part of the Ethereum supply from the Ether staking pool.

Such an initiative could negatively affect the stability and security of the network. Pierce believes that the SEC may return to discussing the concept of staking, which ETF issuing companies were forced to exclude from filings.