According to market intelligence firm Kaiko, the approval of spot Ethereum (ETH) exchange-traded funds (ETFs) in the US could initially lead to selling pressure on the second-largest cryptocurrency by market cap. The US Securities and Exchange Commission (SEC) recently approved the listing of these ETFs, allowing them to be traded on US stock exchanges.

In a recent analysis, Kaiko researchers suggest that the approval could result in significant daily outflows from Grayscale’s Ethereum Trust (ETHE). The researchers point out that ETHE has been trading at a discount of 6-26% over the past three months. With over $11 billion in assets under management, ETHE is currently the largest ETH investment vehicle. The researchers note that Grayscale’s Bitcoin Trust (GBTC) experienced outflows of $6.5 billion during the first month of trading for Bitcoin ETFs, which amounted to approximately 23% of its assets under management on launch day. If ETHE were to experience similar outflows, it would result in average daily outflows of $110 million or 30% of ETH’s average daily volume on Coinbase.

However, the Kaiko researchers also highlight that inflows into other Bitcoin (BTC) ETFs offset and surpassed outflows from Grayscale’s Bitcoin Trust by the end of January, a few weeks after the SEC approved the BTC ETFs.

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