Markets
“Interest in ETH is expected to grow over time”
Trading is expected to begin on July 23 for the new SECOND-Ethereum (ETH) ETFs approved for cash
The approval process required issuers to finalize their S-1 filings by Wednesday, July 17, allowing the ETFs to debut on July 23. new financial products are expected to attract substantial investment, with projections putting inflows at $5 billion in the first six months and potentially up to $20 billion in the first year.
According to a recent report By Bybit, Market Trends and Trading Signals on Spot, Futures, Options and Perpetual Contracts Trading Volume Show Growth Bullish sentiment towards ETH compared to Bitcoin (Bitcoin). This sentiment is reflected in ETH’s sustained volatility premium over Bitcoin, even amid recent market activity and sell-offs.
Update: Nate’s instincts were right, he learned that the SEC finally responded to issuers today, asking them to return the final S-1s on Wednesday (fees included) and then request entry into effect Monday after the close for a LAUNCH TUESDAY 7/23. This is assuming there are no unforeseen last minute issues of course! https://t.co/D21FD9Qf94
— Eric Balchunas (@EricBalchunas) July 15, 2024
The report revealed a significant shift in investor sentiment between Ethereum and Bitcoin.
“I expect interest in ETH to increase over time as more investors now have access to it,” Eugene Cheung, head of institutions at Bybit, told crypto.news in an interview.
Cheung highlighted the long-term bullish outlook for spot ETFs.
“In the short term, the market is anticipating a disappointing response, but this is a long-term bullish catalyst. ETH may also offer long-term diversification benefits, given its different and broader set of use cases compared to BTC,” Cheung said.
Eight major issuers, including leaders asset management companiesare preparing to launch Ethereum-based ETFs. The SEC’s preliminary approval of these products marks a significant step forward for the cryptocurrency industry following the successful introduction of Bitcoin spot ETFs earlier this year.
Ethereum price reacted positively to the news, rising by more than 12% in the last five days. The influx of investments from these ETFs is expected to influence Ethereum market dynamics.
Market Implications and Trader Sentiment
Market analysts suggest that the introduction of Ethereum spot ETFs will boost immediate investments and support long-term growth due to increasing regulatory clarity and technological advancements within the Ethereum ecosystem.
“We’ve seen BTC ETFs used as a basis for trading, with traders going long the ETF and short the futures to capture funding rates,” Cheung said. “I imagine this trade could also open up to ETH ETFs in the future.”
An ETH ETF is a win for crypto because it integrates digital assets into traditional financial markets and sets a precedent for future innovations.