Cryptocurrency exchange BloFin believes that the upcoming launch of spot Ethereum ETFs in the United States will drive a short-term surge in ETH prices as investors turn their attention from Bitcoin to crypto assets Second largest investor by market capitalization.
The exchange, citing various data points such as options skew, portfolio adjustments and whale holdings, noted that the ETF launch will likely boost Ethereum prices in the short term .
“BTC’s relative strength has lasted for several months, but investors are changing their view: they seem to believe that ETH’s performance will increase for some time with the listing of ETH ETFs delivered immediately.”
Last month, the US Securities and Exchange Commission (SEC) approved primary filings (19b-4) for a spot ETH ETF, surprising many market participants. Since then, potential issuers have been engaging with the regulator’s staff and there are rumors that these financial instruments could begin trading as early as the first week of July.
Expect ETH price increase
BloFin found that Bitcoin’s skew data has been more bullish than Ethereum for much of this year. However, the trend has reversed in recent weeks, with short-term investor expectations for Bitcoin now “neutral” and “slightly pessimistic,” while expectations for Ethereum are optimistic. than.
While investors remain bullish on Bitcoin’s mid-to-long-term performance, their optimism for Ethereum has surpassed that of the leading cryptocurrency over shorter time frames.
Analysts explain that one of the reasons driving this change is the potential for higher profits.
“Assets with relatively low market capitalization and relatively high volatility have higher return potential during a rate cut cycle.”
BloFin also predicts that the “asset allocation phase” following the approval of spot Ethereum ETFs will positively impact the price of ETH, similar to what Bitcoin experienced in February and March.
Additionally, the latest forward exchange rate structure of ETH/BTC shows that investors believe that ETH will outperform BTC in the coming months, pushing the exchange rate higher in the short term.
“The Risk Premium difference between ETH and BTC is around 25 basis points and investors are looking forward to the potential new wealth effect brought by ETH following the listing of ETH ETFs delivered immediately.”
BloFin emphasized that onchain data further supports its bullish outlook. According to the company, ETH whales have stopped selling while BTC whales continue to reduce their holdings.
The company notes that this could be due to miners regularly selling BTC for cash, but it could also indicate investors are readjusting their portfolios.
Itadori
According to Cryptoslate
