Ethereum Traders Anticipate Stability Despite Spot ETF Launch

Traders doubt that Ethereum price will decline after the launch of spot Ether exchange-traded funds (ETFs), unlike what happened with Bitcoin after spot Bitcoin ETFs started trading. Crypto trader Matthew Hyland explained on May 24, “I think there is less likelihood of a selloff here after the ETH ETF compared to the BTC ETF.”

Hyland pointed out that, unlike Ether, Bitcoin did not experience a price decline in the months leading up to the approval of spot Bitcoin ETFs on January 10. “The BTC ETF had no pullbacks in the months leading into it. He added that the selling pressure began when the Grayscale ETF was listed the following day. Since the launch of spot Bitcoin ETFs, Grayscale Bitcoin Trust (GBTC) has lost $17.6 billion in assets, according to Farside data.

In contrast, Ether declined by 15% over two months until May 20, when reports suggested the SEC might approve ETFs. Then, within three days of the news, Ether surged 29%.

At publication time, Ether trades at $3,752, per CoinMarketCap data.

Ethereum is up 110.44% over the past 12 months. Source: CoinMarketCap

Grayscale’s Ethereum Trust ETF Conversion Raises Market Concerns

However, some worry about Grayscale’s plans to convert its Grayscale Ethereum Trust (ETHE) to an ETF, which could cause selling pressure and price impact.

“One key similarity is both have a Grayscale product. The Grayscale ETF led to selling pressure for BTC, and likely will see the same for the ETH ETF once the product is listed,” Hyland stated.

Yet, Hyland predicts upward momentum for Ether’s price, as it reached “local highs” of $4,092 in March without the positive ETF approval news.

Meanwhile, MN trading consultancy founder Michaël van de Poppe echoed uncertainty until the spot Ether ETFs started trading. “It’s a waiting time until the listing takes place, and then the inflow will provide whether there’s a strong continuation upwards,” van Pope declared.

On May 24, the SEC approved spot Ether ETFs, prompting Ethereum price movement. Independent Ethereum educator Sassal argued that “ETH is stupidly undervalued” because the market had only three days to “price in the ETF approval.

Related Reading | Ripple CEO Hints At Future Possibilities Amid SEC Advancements

Furthermore, the author’s views are for reference only and shall not constitute investment advice. Before purchasing, please ensure you fully understand and assess the products and associated risks.

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