What's the Hidden Danger Behind Spot Ethereum ETFs？ BitMEX Analysts Announced!

After the SEC approved spot Bitcoin ETFs in January, all eyes turned to spot Ethereum ETFs.

While investors expect ETH ETFs to also receive approval, Bloomberg ETF analyst Eric Balchunas expects the Ethereum spot ETF to have a 70% chance of being approved in May, while JPMorgan analysts said they see no more than a 50% chance of spot ETH ETF approval by May.

While there is no full consensus on Ethereum ETFs, a new report came from BITMEX analysts.

While speculation continues as to whether spot Ethereum ETFs awaiting approval by the SEC will provide returns from staking in Ethereum, BitMEX analysts stated that the lack of staking income in spot ETH ETFs may reduce the attractiveness of ETH ETFs.

According to The Block, analysts emphasized that staking returns are a very important factor in the success of the Ethereum network.

At this point, analysts pointed out that ETH staking return is an important factor for institutional investors and ETF buyers and said the following.

Ethereum staking rewards currently yield around 3.7%.

While this return may not be significant for all Ethereum holders, it remains an important consideration for institutional investors and ETF buyers.

At this point, it's certainly possible for the raw Ethereum price to underperform Bitcoin over the long term, but Ethereum stakers can earn higher returns than Bitcoin holders with the benefit of staking yield. That's why staking return is an important consideration for institutional investors and ETF buyers.

Therefore, if companies applying for ETFs cannot offer returns from Ethereum staking in ETFs, the attractiveness of spot Ethereum ETFs may diminish, even if approved.

BitMEX Research analysts argued that if spot ETH ETFs are launched in the US without staking returns, existing holders and stakers may be less willing to move their assets into an ETF.

Stating that there may be possible solutions to this, analysts said that ETF issuers are desperate for staking because the SEC is “willing to put every possible obstacle in front of ETF providers.”

This means that including staking yield in ETH ETFs could be a step too far, analysts added.

*This is not investment advice.