Spot Ethereum (ETH) exchange-traded funds (ETFs) in the U.S. could experience net inflows at just 30%-35% of the levels seen by spot Bitcoin (BTC) ETFs, according to a research report by Citi. This projection translates to a range of $4.7 billion to $5.4 billion in net inflows over a six-month period. The Citi analysts noted that these figures might be overestimated as both the inflows and ether’s return beta relative to such flows could be lower than anticipated.

Spot Ethereum ETFs are set to become tradable in the U.S. next week after receiving approval from the Securities and Exchange Commission (SEC) earlier this year. However, Citi analysts suggest that while Ethereum offers potential long-term diversification benefits due to its broader set of use cases, these advantages are not yet fully realized.

Citi also highlighted that the lack of staking options in Ethereum spot ETFs might contribute to lower-than-expected inflows. Furthermore, Bitcoin’s first-mover advantage has already secured billions in inflows and strong performance before Ethereum’s ETF approval in May.

Despite these cautious forecasts, Citi’s report noted that the timing of the spot Ethereum ETF launches coincides with an increasingly dovish stance from the Federal Reserve, which may signal lower interest rates, a stronger equity market, and a weaker U.S. dollar. Such a macroeconomic environment could prove beneficial for the broader crypto market.