Finally breaking the limbo, the US SEC has approved all eight-spot Ethereum ETF, heralding a new era in the crypto industry. According to market experts, the SEC greenlighting the ETH spot ETF is mainly due to the correlation between CME Ethereum futures and certain spot ETH trading platforms. Most of the SEC documents provide data evidence of high correlation, and the monitoring and sharing agreements of CME and others can help prevent fraud and manipulation.
As the news gains traction, the crypto market will soon hit a speculation wave. For those thinking ETH will go back to $3k or below, a sort of “sell the news” event will be in for a surprise. As per Crypto Nova, the ETF is set to commence trading in a few months. Everyone will likely aim to invest before its launch, causing demand to increase significantly beforehand. But comparing Bitcoin’s pullback would be akin to comparing apples with oranges.
Ethereum: Why It’s Not Bitcoin 2.0
In Bitcoin’s case, it was expected to surge and this anticipation led to a prolonged rally, with prices steadily increasing over months. But in the case of the Ethereum ETF, the approval was unexpected and happened much faster, within less than a week. Despite this sudden news, ETH’s price jumped from $3,000 to $3,800. While some correction to around $3,500 is possible, a drop back to $3,000 or lower seems unlikely.
One indicator that Ethereum’s ETF approval is not as fully priced in as Bitcoin’s was is the ETH/BTC chart. This chart shows the performance of ETH relative to Bitcoin. It indicates that Ethereum is near its local low and has been in a downward trend since the last bull run in 2021. This suggests that Ethereum has not yet experienced the same level of price integration and anticipation as Bitcoin did, which could imply further room for growth. Investors should consider this when making decisions, as the market dynamics for Ethereum ETFs are different from those of Bitcoin.
