The analysts at K33 Research are predicting that the introduction of Ether (ETH) exchange-traded funds (ETFs) could lead to the cryptocurrency outperforming Bitcoin (BTC) in the United States after they are launched. The ETFs are expected to go live as early as July 8 and are seen as a major opportunity for ETH’s price, while Bitcoin is anticipated to experience selling pressure as $8.5 billion worth is returned to creditors of the collapsed Mt. Gox exchange, according to K33 analysts Vetle Lunde and David Zimmerman in a report dated July 2.
ETH has been underperforming against Bitcoin for more than a year, with Bitcoin posting the leading market gains thanks to over $14 billion in flows to Bitcoin exchange-traded products this year. Lunde and Zimmerman expect ETH to initially stumble following the ETF launch, but they believe that inflows to the funds will ultimately bolster ETH’s price, similar to what happened with Bitcoin.
Lunde stated that “ETFs are a solid catalyst for relative ETH strength as the summer progresses and flows accumulate, and I firmly view current ETH/BTC prices as a bargain for the patient trader.” The analysts noted that the market still disagrees with their position, pointing to Ether futures trading at a relative discount to Bitcoin futures and the price of ETH relative to the price of Bitcoin trading at a rate of 1 ETH to 0.055 BTC.
The value of ETH has been on a steady decline compared to Bitcoin for the past 12 months, reaching a yearly low of 0.045 on May 24. However, the price of Ether relative to Bitcoin reversed quickly following the SEC’s unexpected decision to approve Ether ETFs, surprising analysts and pushing ETH/BTC to its current value of 0.055, according to TradingView data.
Despite this, Lunde and Zimmerman observed that Ether futures open interest has been increasing, indicating that many traders are taking on significant leverage to bet on ETH’s potential price action leading up to the ETF launch.
Overall, K33 Research is optimistic about the potential impact of the ETH ETFs and believes that it could lead to a shift in the cryptocurrency market, with ETH potentially outperforming BTC in the near future.