As a seasoned crypto investor with over five years of experience in the industry, I have witnessed the evolution of Ethereum and its growing significance within the crypto ecosystem. Hany Rashwan’s appearance on Bloomberg Crypto piqued my interest, as he is the Co-Founder and CEO of 21Shares, a leading global issuer of crypto ETFs.
On July 23, 2024, Hany Rashwan, Co-Founder and CEO of 21Shares, made an appearance on Bloomberg Crypto with Sonali Basak and Tim Stenovec. During the interview, they discussed Ethereum‘s price behavior on the day that nine US-listed Ethereum exchange-traded funds (ETFs) became available for trading. Hany explained the target audience for these ETFs, delved into Ethereum’s applications, and explored the potential future prospects of incorporating staking rewards in these ETF structures.
Ethereum’s Price Action and Market Conditions
Rashwan commenced his analysis by focusing on Ethereum’s recent price trend, which saw a three-day streak of decreases.
Rashwan pointed out that the timing of Ethereum ETF launches played a role in the recent price surge, acknowledging the substantial increase in trading activity. However, he emphasized that some of this price movement had been anticipated beforehand. He drew a parallel to the launch of spot Bitcoin ETFs, which took place under more advantageous circumstances. Furthermore, Rashwan highlighted how global economic trends and the summer season influenced Ethereum’s performance. Despite these temporary market turbulences, Rashwan remained positive about Ethereum’s prospects within the next 6 to 12 months.
Target Audience for Spot Ethereum ETFs
Regarding who might be interested in purchasing Ethereum-focused spot ETFs, Rashwan emphasized the wide range of potential buyers. As the leading worldwide issuer of cryptocurrency ETFs through 21Shares, they serve both individual and institutional investors. Retail investors typically opt for ETFs due to the intricacies involved in establishing their own wallets and managing related infrastructure. Institutional investors, such as family offices and independent asset managers, are drawn to the regulated framework and safekeeping solutions offered by ETFs. Although insurance and pension funds have yet to fully adopt crypto investments, Rashwan is optimistic about their future involvement.
Ethereum’s Use Cases
Rashwan elaborated on the distinct functions of Ethereum versus Bitcoin. He characterized Bitcoin as “digital gold,” used as a safeguard against questionable fiscal and monetary policies. In contrast, Ethereum is celebrated for its functional applications, notably in decentralized finance (DeFi). Rashwan emphasized that Ethereum’s blockchain serves as the base for various financial innovations, such as smart contracts and stablecoins. He highlighted that transactions worth $10 trillion were processed by Visa last year, while Ethereum-based stablecoins handled $9.3 trillion in settlements.
Future Integration of Staking Rewards
One of the significant points raised during the discussion was the prospect of incorporating staking rewards into Ethereum exchange-traded funds (ETFs). Rashwan acknowledged that staking rewards had not been incorporated in these new ETFs as yet, but emphasized that it was a question of “when,” not “if.” He clarified that adding staking rewards involved educating regulators about the concept and securing their approval. Rashwan highlighted that 21Shares had already launched Ethereum exchange-traded products (ETPs) without staking rewards in other markets and intended to enhance these offerings gradually. He remained optimistic about receiving the U.S. Securities and Exchange Commission’s (SEC) approval for staking rewards, referencing the extended process of obtaining approval for spot Ethereum ETFs.
Political Landscape and Crypto Regulation
The discussion additionally covered the possibility of how the upcoming U.S. presidential election might influence crypto regulations. According to Rashwan, the day-to-day functions of regulatory institutions would likely remain consistent regardless of the election’s outcome. However, he stressed that it was crucial for cryptocurrencies to gain traction in political debates due to their increasing relevance among U.S. citizens.
As I pen this down (at 9:30 p.m. UTC on July 23rd), Ethereum is being exchanged for approximately $3,479, marking a 0.6% increase in value compared to the previous day.
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2024-07-24 00:38