Ether (ETH) had a strong start to the year but experienced a decline in mid-March. However, it regained momentum in mid-May due to the anticipation of the approval of spot Ether exchange-traded funds (ETFs) in the United States.
Since the official approval of spot Ether ETFs by the Securities and Exchange Commission on May 23, ETH has outperformed Bitcoin (BTC), which had been leading since January 1. In the past month, ETH has surged approximately 30% compared to BTC’s 9% gain in their respective U.S. dollar pairs.
There are three main reasons behind ETH’s outperformance. Firstly, there has been a growth in network activity, contributing to its performance. Secondly, there is increased excitement surrounding the launch of spot Ether ETFs. Lastly, the ETH/BTC ratio has been trending higher, reaching a two-week high on May 23.
From a technical perspective, the ETH/BTC weekly chart showed a bullish divergence, indicating a potential trend reversal. This ratio is considered bullish as long as it remains above 0.051. Analysts have expressed optimism about ETH’s future, with some predicting that the ETH/BTC ratio will reach 0.1 within a few months.
In addition to the positive on-chain metrics, the likelihood of Ether ETFs making their market debut soon is further adding to ETH’s bullish momentum. Bloomberg senior ETF analyst Eric Balchunas believes that these investment products have a legitimate chance of launching by late June. However, he also mentions the possibility of further filings and suggests that an end-of-June launch is a realistic possibility.
Market participants are optimistic about the impact of spot Ether ETFs on ETH’s price. Some speculate that it could reach new highs and serve as a bet on the growth of Web3. Others even speculate that ETH’s price could reach $10,000 during this cycle as institutional capital flows into Ether ETFs.
It is important for readers to conduct their own research and exercise caution before making any investment decisions related to the mentioned products or companies.