Solana ETF No Chance? BlackRock: Ethereum ETF Unlikely to Open Door for Other Cryptocurrencies

Robert Mitchnick, the digital assets head of BlackRock, the world's largest asset management company, stated at the Bitcoin 2024 conference that the launch of an Ethereum spot ETF is unlikely to pave the way for other cryptocurrency funds, and the U.S. Securities and Exchange Commission (SEC) is also unlikely to approve an Ethereum spot ETF with staking components.

Ethereum ETF Unlikely to Open Doors for Other Cryptocurrencies

According to a report by The Block, Robert Mitchnick, the digital assets head at BlackRock, the world's largest asset management company, discussed the Bitcoin and Ethereum spot ETFs launched this year during the Bitcoin 2024 conference with Bloomberg analyst James Seyffart:

Bitcoin represents about 55% of the market value. ETH at 18%. The next reasonable investable asset is probably around 3%. It's just a long way off in terms of achieving that threshold or maturity, liquidity, and so on.

This means that cryptocurrencies as an asset class will not disappear, but the launch of Bitcoin and Ethereum spot ETFs is also unlikely to pave the way for other cryptocurrency funds.

Mitchnick believes that Bitcoin is trying to become a global alternative currency, a potential global payment system, while Ethereum is better seen as a technology platform for building novel applications. These two will not replace each other. He also commented that the U.S. Securities and Exchange Commission (SEC) is unlikely to approve an Ethereum spot ETF with staking components.

Bitcoin is an Independent Risk Asset, Still in Early Stages

Mitchnick mentioned that typical investors of BlackRock's Bitcoin ETF IBIT usually allocate 2% to 3% of their funds to IBIT, which still has growth potential. Bitcoin is fundamentally a different asset type from "stocks, fixed income, or other traditional assets," with different value propositions, a fact that the company's clientele, ranging from retail to ultra-high net worth, is just starting to realize, and these clients are becoming increasingly interested.

Mitchnick is particularly bullish on the interest from wealth advisors and institutions, which currently make up a minority of IBIT investors.

This is a longer-term journey; it's still in the "early" stages. We're starting to see this shift—people are starting to view Bitcoin as a potential safe haven.

Bitcoin itself is an independent risk asset, but these risks are related to uncertainties about future adoption, regulation, and the early-stage ecosystem development. They are very different from risk factors in the traditional financial world such as banking crises, geopolitical turmoil, currency inflation, deficits, debt, and currency devaluation.