"Altcoin ETFs Unlikely to Grow as Easily as Bitcoin ETFs"

Bloomingbit Newsroom

Summary

Ben Slavin said that while the pace of U.S. altcoin ETF launches is accelerating and some investor demand is being confirmed, it will be difficult for them to grow to the extent seen by Bitcoin ETFs.
He said that because altcoin ETFs are sensitive to market price moves, fund inflows and outflows may repeat in the short term depending on price fluctuations, but over the long term investor interest could gradually broaden.
Monica Long said that while the crypto ETF market’s share remains negligible, broader adoption could bring forward market participation by companies and institutions, and interest is rising in digital assets and tokenized asset investment.

Altcoin exchange-traded funds (ETFs) are increasingly being launched in the United States, but analysts say it will be difficult for them to replicate the growth trajectory of Bitcoin (BTC) ETFs.

According to crypto media outlet The Block on the 1st (local time), Ben Slavin, global head of ETFs at BNY Mellon, assessed the altcoin ETF market, saying, "The pace of launches is accelerating, and we are seeing some investor demand."

However, he projected that "unlike Bitcoin ETFs, which hold about 7% of Bitcoin’s total circulating supply, it will not be easy for altcoin ETFs to scale to that level." He explained that altcoin ETFs tend to react sensitively to market price moves.

Slavin added, "In the short term, altcoin ETFs could see repeated inflows and outflows depending on price fluctuations," but said that "over the long term, investor interest could gradually broaden."

In this context, Monica Long, president of Ripple Labs, underscored that the crypto ETF market remains in its early stages. She noted that "more than 40 crypto ETFs were launched last year, but their share of the U.S. ETF market is still negligible."

She continued, "As adoption of crypto ETFs expands, corporate and institutional participation in the market could be pulled forward," adding that "interest is growing—particularly among large companies—in treasury strategies using digital assets and in investing in tokenized assets."