The much anticipated and upcoming launch of spot Ether exchange-traded funds (ETFs) is likely to drive Ethereum to continue outperforming Bitcoin, according to research firm Kaiko. Bloomberg reported that Kaiko cited an increase in Ether’s price relative to Bitcoin, which rose from 0.045 to around 0.05 after the first stage of approval for Ether ETFs from the US Securities and Exchange Commission (SEC).
Ethereum Continues A Strong Momentum Despite Hurdles
The Ether-to-Bitcoin ratio is a key indicator that shows how much Bitcoin is required to buy one Ether token. A greater ratio indicates that Ether is more valuable relative to Bitcoin. Despite Ether’s price dropping by around 10% to $3,380 after the SEC’s first clearance on May 23, the higher ratio predicts a bright future for Ether once the ETFs begin trading.
The final approval from the SEC is anticipated around mid-July, according to Steve Kurz, head of asset control at Galaxy Digital. This follows a trend discovered with Bitcoin ETFs, where the cryptocurrency’s rate surged approximately 50% this 12 months to $63,400. In evaluation, Ether has visible a 48% boom in 2024.
Furthermore, Reuters reported that BlackRock, VanEck, and Franklin Templeton are among the eight asset managers whose applications are expected to be approved by the SEC next Monday afternoon, July 22, with trading in the products expected to begin the following day, according to industry sources who spoke on the condition of anonymity due to the confidentiality of the discussion with the agency.
Ether ETFs To Draw In More Institutional Investors
Matthew O’Neill, co-director of research at Financial Technology Partners, emphasised that the launch of an Ether ETF might allow institutional buyers to diversify their crypto portfolios just like the case was with Bitcoin. He stated, “They would be able to choose from two flavours on the menu rather than just one,” indicating a broader reputation and investment in Ether along with Bitcoin.
O’Neill also stated that the prospective clearance of the ETFs has not been fully incorporated into the market, with some investors being cautious and waiting until the ETFs begin trading. This means that Ether’s price has the potential to rise. With a market value of approximately $400 billion, Ether stands as the second-largest cryptocurrency after Bitcoin, which holds a market value of around $1.2 trillion.
The introduction of spot Ether ETFs marks a significant milestone in the cryptocurrency environment, indicating increased institutional interest and the potential for widespread adoption. As the market awaits final SEC approval, enthusiasm for Ether’s performance grows, suggesting an exciting development in the crypto world.
Also read: ETF Inflows Make BlackRock Reach $10.6T AUM