DeFiance Capital Foresees ETH Soaring To $4,500 Pre-Ethereum ETF Trading
May 27 2024 - 1:00PM
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As the US Securities and Exchange Commission (SEC) approved all the
spot Ethereum ETF applications, despite increased regulatory
uncertainty surrounding the cryptocurrency, investors are becoming
more optimistic about the potential for ETH’s price to reach new
heights. Bullish Sentiment Surrounds Ethereum ETF
Approval DeFiance Capital Founder and CIO Arthur Cheong
predicts that ETH could reach an annual high of $4,500 before the
newly approved index funds begin trading, surpassing its mid-March
high of $4,096. This projection falls just short of ETH’s all-time
high of $4,878 during the 2021 bull run. In addition, a survey
conducted by WuBlockchain in the Chinese community revealed that
58% of respondents believe that ETH has the potential to rise to
$10,000 or even higher in this market cycle. Related Reading:
Kickstarting The Bitcoin Bull Run: Expert Says $70,000 Is The Level
To Beat The recent regulatory pivot by the SEC towards approving
Ether ETFs has intensified bets on further price gains. In the
seven days following the announcement, ETH experienced a 26% surge,
marking the largest weekly advance since the 2021 crypto bull
market. This development brings hope to speculators,
considering the success of US spot Bitcoin ETFs, which have amassed
$59 billion in assets since their record-breaking debut in
January. However, spot Ethereum ETFs will not participate in
staking, earning rewards by pledging tokens to maintain the
Ethereum blockchain. This omission could potentially dampen
interest in these funds in comparison to holding the tokens
directly. Although additional SEC approvals are required before
issuers such as BlackRock and Fidelity Investments can launch their
products, the timeline for these releases remains uncertain. As of
now, ETH is trading around $3,900, with expectations of further
upside potential. Options Bets Signal Potential Climb To $5,000
According to a Bloomberg report, analysts such as Pepperstone Group
Head of Research Chris Weston believe that pullbacks in ETH are
buying opportunities as the risk remains skewed to the
upside. Interestingly, as seen in the chart below, some
traders are placing bullish options bets, with concentrations
signaling a potential climb to $5,000 or more. Furthermore, ETH’s
volatility, as indicated by the T3 Ether Volatility Index, is
expected to be greater than that of Bitcoin, highlighting the
potential for larger price swings in the second-largest digital
asset. Related Reading: Ripple CTO Addresses Curious Price Link
Between XRP And XLM Insights from the futures market, particularly
the level of open interest in Chicago Mercantile Exchange (CME)
Ethereum futures, provide evidence of institutional demand for
regulated exposure to cryptocurrencies. While open interest
in CME Ether futures is growing, it remains significantly lower
than that of CME Bitcoin futures. This suggests relatively less
institutional exposure to Ether and could potentially impact
initial inflows into Ether ETFs. Nevertheless, as the approval of
Ethereum ETFs opens up new avenues for investment and speculation,
the market is closely watching ETH’s price performance, with
bullish sentiment and optimistic predictions prevailing among
investors. Featured image from Shutterstock, chart from
TradingView.com
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