Traders are expressing doubt about the potential decline in the price of Ether (ETH) following the introduction of spot Ether exchange-traded funds (ETFs), similar to what happened with Bitcoin (BTC) when spot Bitcoin ETFs began trading.
In a post on X, crypto trader Matthew Hyland explained his skepticism, stating that he believes there is a lower chance of a sell-off after the launch of the ETH ETF compared to the BTC ETF. Hyland pointed out that unlike Ether, Bitcoin did not experience a price decline leading up to the approval of spot Bitcoin ETFs on January 10. He added that the selling pressure for Bitcoin started when the Grayscale ETF was listed the following day. Since the launch of spot Bitcoin ETFs, the Grayscale Bitcoin Trust (GBTC) has lost $17.6 billion in assets, according to Farside data.
By May 20, Ether had already declined by 15% over two months, but it surged by 29% shortly after reports suggested a possible shift in the SEC’s stance toward ETF approvals. At the time of publication, Ether is trading at $3,752, according to CoinMarketCap data.
However, there are concerns about the potential selling pressure and price impact resulting from Grayscale’s plan to convert its Grayscale Ethereum Trust (ETHE) to an ETF. Hyland highlighted the similarity between BTC and ETH in terms of both having a Grayscale product, and he anticipates that the ETH ETF will also lead to selling pressure once it is listed.
Despite these concerns, Hyland predicted upward momentum for Ether’s price, citing its “local highs” of $4,092 in March this year, which occurred without the positive news of spot Ether ETF approval. However, ETF analyst Eric Balchunas has lowered the probability of spot Ether ETF approval to 25%.
Similarly, Michaël van de Poppe, founder of MN trading consultancy, expressed uncertainty until the spot Ether ETFs start trading. He believes that the listing will provide clarity on whether there will be a strong continuation upwards.
On May 24, Cointelegraph reported on the widespread commentary about the lack of movement in Ether’s price following the approval of spot Ether ETFs by the SEC. Independent Ethereum educator Sassal argued that ETH is undervalued and stated that the market has only had three days to “price in the ETF approval.”
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