The odds of spot Ethereum ETF emerging anytime soon are looking increasingly dire, but some crypto experts say that may be for the better.

“Spot Ethereum ETFs will gather more assets if they launch in December versus if they launch in May,” wrote Matt Hougan, CIO of Bitwise, on Twitter on Tuesday. “TradFi needs more time to digest the Bitcoin ETFs.”

Bitcoin spot ETFs, which hit the U.S. market on January 11, have absorbed $12 billion in net inflows since launch. One of those ETFs belongs to Bitwise itself, which now holds nearly $2 billion in BTC on behalf of clients.

Hougan has repeatedly argued that there is still ample room for greater adoption of Bitcoin ETFs by the traditional financial world, and that certain target markets—like corporations and wirehouses—are still “plugging in” to the asset.

A survey released by Bitwise in early January, however, found substantially less interest in Ethereum among financial advisors. At the end of last year, 71% of respondents favored Bitcoin, compared to a roughly 50/50 split in 2022.

“Aside from Bitcoin (which is in a class of its own), the most excitement I've heard in terms of real-world use is around stablecoins,” added Hougan, based on his attendance at the institutionally-focused Blockworks DAS conference. “Seems clear to me that stablecoins will be a multi-trillion market by the end of 2025.”

Bloomberg’s ETF experts are apparently of the same mind: earlier this month, analyst Eric Balchunas said that Ethereum spot ETF would be “small potatoes” next to their Bitcoin-based counterparts.

Neither Balchunas nor his associate, James Seyffart, believe such ETFs are likely to receive approval by May 23, which is the SEC’s final deadline for approving or deny he first wave of applications for the product.

“[Regulators] need to start having convos with the issuers ASAP and they don’t seem to be doing that based on anything we’ve seen thus far,” wrote Seyffart on Monday.

Further impacting the odds for some issuers—including Fidelity and Ark—is the promise to stake a portion of their fund’s assets to earn a yield from the Ethereum network. Blockchain staking and proof-of-stake cryptocurrencies are already in dicey legal territory with the Securities and Exchange Commission (SEC), held solidly in the spotlight in many of the agency’s lawsuits against the crypto industry.

James Butterfill, Head of Research at CoinShares, believes an SEC decision on the ETFs may be delayed until the third quarter of 2024 or later due to unresolved issues around staking.

“Currently, it appears that incorporating staking within a grantor trust is not feasible,” Butterfill told Decrypt.

“Given the SEC's history of postponements, as observed with Grayscale over ten years and Blackrock last September, the likelihood of further delays is high,” he continued. “With much optimism placed on May, investors might face disappointment.”

Edited by Ryan Ozawa.