BloFin, a crypto exchange, predicts a surge in Ethereum prices due to the imminent launch of spot Ethereum exchange-traded funds (ETFs) in the US. According to the exchange, investors are shifting their focus from Bitcoin to Ethereum, which is the second-largest crypto asset by market capitalization. This shift in attention is expected to drive up Ethereum’s price in the short term as the ETFs are launched. BloFin’s analysts suggest that the strength of Bitcoin has been dominant for months, but now investors are beginning to believe that Ethereum will see a period of strength with the introduction of spot ETH ETFs.
The US Securities and Exchange Commission (SEC) recently approved key filings for spot ETH ETFs, surprising many in the market. The ETF applicants are currently in discussions with the SEC staff, and there are rumors that trading of these financial instruments could begin as early as the first week of July. BloFin has observed a shift in bullish expectations towards Ethereum, with investors showing more optimism for Ethereum’s short-term performance compared to Bitcoin. This change is driven, in part, by the potential for higher returns in assets with low market caps and high volatility during interest rate cut cycles.
BloFin also predicts that the approval of spot Ethereum ETFs will lead to an “asset allocation period” that will positively impact Ethereum’s price, similar to the effect seen on Bitcoin in February and March. The forward exchange rate term structure of ETH/BTC suggests that investors believe Ethereum will outperform Bitcoin in the coming months. The analysts also note that the Risk Premium difference between ETH and BTC has narrowed, indicating investor anticipation of potential new wealth effects following the listing of spot ETH ETFs. On-chain data further supports BloFin’s bullish outlook, as ETH whales have stopped selling their holdings while BTC whales continue to reduce theirs. This shift could be attributed to miners selling BTC for cash or investors readjusting their portfolios.
In conclusion, BloFin is optimistic about the short-term price performance of Ethereum following the launch of spot Ethereum ETFs in the US. The exchange believes that investors are shifting their focus from Bitcoin to Ethereum, driving up the price of the second-largest crypto asset. With the approval of spot ETH ETFs on the horizon, BloFin anticipates a positive impact on ETH’s price, supported by data points such as options skewness, portfolio adjustments, and whale holdings. The analysts also highlight the potential for higher returns in assets with low market caps and high volatility, suggesting that Ethereum may outperform Bitcoin in the months to come.
