According to Polymarket bettors, there’s a 90% chance that ether ETFs will be approved by July 26.
Rising Ether Stakes
As the U.S. edges closer to launching an ether (ETH) exchange-traded fund (ETF), the amount of staked ether is nearing a record high. Despite the growing total amount of ETH, the circulating volume remains controlled.
Julio Moreno, CryptoQuant’s head of research, noted, “The total number of staked ETH has continued to increase and sits near its all-time high at 33.3 million ETH or 27.7% of the total supply.”
Inflationary Trends
The increasing supply of ether, the second-largest cryptocurrency, indicates it has become an inflationary asset again, potentially undermining its role as a store of value. However, mechanisms like staking, which locks ether for a set period, and burning a portion of transaction fees, help counter this trend.
Moreno wrote, “ETH supply is growing again, although slowly. But the narrative of ultra-sound money has ended. The total supply is at its highest level since December 11, 2023.”
Liquidity and Usage
Moreno also mentioned that ETH could be as liquid as bitcoin (BTC), with ETH spot trading volume reaching 80%-90% of bitcoin’s in recent weeks. CoinMetrics data shows around 12% of ether’s supply is used in smart contracts or bridges connecting blockchains. Combined with staked tokens, about 40% of ether is “locked” and not actively traded.
Path to the ETH ETF
The competition to launch an ether ETF is intensifying. Polymarket bettors believe trading will start before July 26. Invesco and Galaxy recently announced a 0.25% management fee for their proposed spot ether ETFs, slightly higher than VanEck’s 0.20%. However, the SEC must review current applications, and issuers need to file final amended forms with fee details before trading can commence.
Ether vs. Bitcoin
On Kalshi, bettors give a 65% chance that ether will outperform bitcoin, but 95% are confident that ether won’t hit an all-time high before bitcoin does.
