Ethereum Price Forecast: 1st Institutional ETH Fund Launches

ethereum_pricesEthereum News Update

Yesterday, I said Ethereum was starting to front-run Bitcoin in terms of institutional support. And what happened the same day? A major pension fund launched a $50.0-million cryptocurrency investment fund—and it is based around Ethereum.

The new fund comes courtesy of OMERS, one of Canada’s biggest pension funds. (Source: “Ethereum Capital Announces Launch of $50 Million Private Placement Offering, Backed by Leading Management Team and Prominent Investors,” GlobeNewswire, January 29, 2018.)

OMERS is famous for making strategic investments in the tech space. It scooped up cheap assets during the 2008 financial crisis, which paid off handsomely in the decade that followed.

Ethereum Price Chart

ethereum price chart for 30 jan 2018

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Apparently, its prophetic abilities were not a one-time occurrence, because OMERS saw the crypto boom as well.

“OMERS has been active in the blockchain and crypto sector for several years now,” said John Ruffolo, Executive Managing Director of OMERS Platform Investments and Board Director for Ethereum Capital.

“OMERS believes in the potential of blockchain technologies and I am thrilled to join a strong network of advisors as Ethereum Capital creates value in the sector,” he added.

The new fund is called Ethereum Capital. It will draw expert advisors from partners such as Purpose Investments, Citizen Hex Inc., L4, and (of course) OMERS. Industry veteran Som Seif will head up the team as Executive Chairman and Co-CIO.

Here’s how it will work: Ethereum Capital will get Canaccord Genuity Group Inc (TSE:CF) and CIBC Capital Markets to issue 20 million units at $2.50 apiece. Only accredited investors will have access. By the end of the round, the fund expects to raise $50.0 million.

Analyst Take

Here are a few things you should remember:

  • The fund is not denominated in ETH.
  • The fund will buy ETH after raising funds from investors.
  • $50.0 million isn’t a lot of venture capital.
  • There are three institutional players involved in this offering: OMERS, Canaccord, and CIBC.
  • This is one small step for cryptos, one giant leap for Ethereum.

I don’t expect ETH prices to surge immediately, but this is proof that Ethereum is poaching institutional support from Bitcoin. Before you know it, ETH will become the leading cryptocurrency in the world.

As such, we maintain our $1,500 Ethereum price forecast for the first half of 2018.