Pantera Capital is focused on probably investing $100 million in Bitwise‘s spot Ethereum (ETH) ETF as seed capital if the funds are approved to launch.
Bitwise’s June 18 S-1 modification states that Pantera has “indicated an interest” in buying shares. Pantera would buy the shares from licensed contributors or broker-dealers available in the market by means of a minimum of certainly one of its affiliated funding funds.
If Pantera or its associates proceed with the acquisition beneath the indication of curiosity, they can not promote the shares in an open-market sale for six months. Nonetheless, they’ll get rid of the shares in a redemption transaction with licensed contributors.
Pantera has not entered a binding settlement or dedicated to a purchase order. It might make investments roughly than $100 million or nothing in any respect.
Pantera optimistic on Ethereum ETF
In a June 18 letter to buyers, Pantera Capital CEO Dan Morehead and different workers wrote that spot Ethereum ETFs might entice “a substantial influx of new investors” beforehand excluded as a consequence of compliance causes or brokerage account limitations.
The agency believes that some buyers could also be extra focused on and higher in a position to comprehend Ethereum’s repute as a “tech platform” in comparison with Bitcoin’s standing as “digital gold.”
The agency additionally acknowledged arguments that Ethereum has underperformed over the previous 12 months and a half, which might make the asset a “strong catchup trade candidate.”
Pantera added that the ETFs might carry a “surprising upside” as a consequence of low expectations round flows however acknowledged the opportunity of important outflows.
The agency famous that Grayscale’s ETHE fund might see outflows when it begins buying and selling as an ETF. Nonetheless, the outflows may very well be “less material” than early Grayscale GBTC outflows as a consequence of fewer compelled sellers.
Pantera named Three Arrows Capital (3AC) and Genesis, which entered chapter in 2022 and 2023, respectively, as compelled sellers who needed to offload their GBTC holdings.
Knock-on results
Lastly, Pantera mentioned spot ETH ETF approvals might have broader “knock-on effects,” together with market development and diversification advantages. In line with the agency:
“Increased attention on ETH may spill over to the broader universe of protocols as investors explore Ethereum as a technology platform.”
It added that ETH approvals might result in larger integration with mainstream monetary merchandise, making blockchain “just another asset class” alongside hundreds of different current securities dealt with by registered funding advisors (RIA).
Pantera additionally advised that the newest approvals might result in spot ETFs for different crypto tokens. Executives at JP Morgan, Bernstein, and Cboe have equally mentioned the opportunity of different crypto ETFs, expressing various ranges of optimism.
