The cryptocurrency market has recently been a hub of exciting developments, surpassing other markets in terms of enthusiasm. Despite the approval of spot Ethereum ETFs to be listed on US exchanges, both Bitcoin (BTC) and Ethereum (ETH) experienced a decline in the past 24 hours. This decline triggered a classic behavior in the market known as “buy the rumor, sell the news,” resulting in a 4% drop in ETH price.
A Crucial Moment for Ethereum
The approval of spot Ethereum ETFs was seen as a significant milestone for the cryptocurrency market, particularly for ETH, the second-largest cryptocurrency by market value. However, this ETF approval did not lead to the anticipated price increase. Instead, it indicated a short-term downward trend. Check out NEWSLINKER for the latest technology news.
Alex Kuptsikevich, a senior market analyst at FxPro, attributed the sales to the speculative nature of the market. Kuptsikevich believes that the price of Ethereum could decline to around $3000, which could present an opportunity for large institutional investors to enter the market through ETFs. This situation mirrors a similar pattern observed after the approval of a Bitcoin ETF in January.
No Trading Approval for ETFs Yet
While the necessary regulatory filings for ether ETFs have been approved by the SEC, allowing them to be offered and listed, they have not yet been approved for trading. The approval process involves an additional review of S-1 filings before investors can buy the funds. However, the approval of these filings could pave the way for listing on major exchanges.
ETF trading possesses significant potential for institutional capital inflow into the cryptocurrency market. Standard Chartered predicts that there could be an inflow of up to $45 billion in the first year of trading, which could support the prices of Bitcoin and Ethereum and create a long-term upward trend.
Hopeful Expectations for the Future
Despite the short-term price correction, some investors remain optimistic about the future performance of Ethereum. The expectation of a rally exceeding 60% in the coming months is backed by the increasing demand for futures and spot purchases observed recently.
This upward trend reflects confidence in the potential growth of Ethereum and the overall cryptocurrency market, despite the current market dynamics.
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Disclaimer: This article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.
