Key Points
- The upcoming launch of the spot Ethereum ETF could lead to Ethereum outperforming Bitcoin.
- Kaiko’s report shows optimism about Ethereum’s future market performance and potential for greater institutional inflows.
The impending launch of the spot Ethereum ETF is drawing attention from institutional players who are keeping a close eye on the price action of Ethereum (ETH). A recent report from Kaiko displays a strong positive outlook on the future market performance of Ethereum.
Ethereum’s Potential Market Dominance
Kaiko suggests that Ethereum could surpass Bitcoin in terms of performance following the launch of the spot Ethereum ETFs, which is expected to occur in the next two weeks. The report also indicates that this development could stimulate the broader market and attract more institutional investments.
The research by Kaiko particularly highlights Ethereum’s market performance compared to Bitcoin. After the approval of the 19b-4 filings for the spot Ethereum ETF on May 23, the ETH/BTC ratio has seen a significant increase from 0.045 to 0.050. This ratio is a key indicator for comparing the two assets and suggests that Ethereum could continue to gain traction, especially with the introduction of ETFs.
Recent Ethereum Market Performance
During the recent cryptocurrency market downturn, the price of Ethereum fell to $2,700. However, Ethereum has since recovered along with the broader market and is currently trading around $3,400.
Despite the typical decrease in trading volumes during the summer months, Kaiko notes that overall liquidity conditions for Ethereum have remained stable. Ethereum’s 1% market depth has stayed around $230 million since the approval of the spot ETFs. Market depth refers to the volume of Ethereum that can be bought or sold near the last traded price without significantly impacting the price.
According to Kaiko’s final report, the introduction of the spot Ethereum ETF could further enhance liquidity conditions for Ethereum and potentially reduce price volatility over time. Ethereum has been successful in attracting traditional investors over the years due to its smart contract functionality and the large number of decentralized applications (dApps) it hosts.
Anticipated Launch of Spot Ethereum ETFs
Eric Balchunas, a senior ETF analyst for Bloomberg, anticipates the Ethereum ETF to launch on Tuesday, July 23rd. He also predicts that the final submission for the S-1 forms will occur this Wednesday. If these predictions hold true, the price of Ethereum could rally to $4,000 by the end of July. According to the technical chart, popular trader Peter Brandt expects the Ethereum price to rise to $5,600.
