Ethereum
When will Ethereum price recover?
What is happening?
Last week, Ethereum experienced a massive selloff, with the price falling below $2,900.
A recent report from CoinShares highlights that Ethereum has seen a massive outflow of capital, the largest since August 2022, with total losses amounting to $119 million over the past two weeks.
Source: CoinMarketCap
This is a continuation of the trend from a week ago, when Ethereum’s price fell from a high of $3,887 to a low of $3,232, a loss of 16.9%. Even though ETH’s price is currently stagnant, an increase in staking indicates that existing users believe in ETH’s long-term potential.
Following the launch of the ETF
According to Bloomberg, several candidates are supposed to to submit their amended S-1 forms by July 8. This could mean that final approval of the S-1 forms should occur by July 12, while the launch could occur sometime in the following week.
Asset managers are optimistic that the SEC will approve the first U.S. ETFs that invest directly in Ether by mid-July. The market had previously speculated that the approval would come during the July 4 holiday week.
Related
However, the SEC has informed Ether exchange-traded fund applicants that they have until July 8 to submit updated documents. There could be another round of filings after that date.
Some experts, such as Eric Balchunas, point to an unnecessary pause on the part of the SEC.
No one is quite sure why the SEC is taking its time with these securities, given the lightness of the comments, they could easily have been traded at this point. It could be a “problem” issuer slowing things down or it could just be summer laziness or people on vacation. I’m not sure. That said, all indications are that things are moving along nicely…
— Eric Balchunas (@EricBalchunas) July 3, 2024
The SEC’s comments to issuers have been limited to minor issues that are currently being addressed. In May, the SEC approved a proposal by the exchanges to list these products, but separate approval is required before they can be launched.
Galaxy Digital’s head of asset management believes spot Ether ETFs will be approved in “weeks” rather than days, but agrees the decision will come sometime in July.
Who’s joining us?
Asset manager Bitwise filed an amended Form S-1 for an Ethereum exchange-traded fund ahead of a July 8 deadline, indicating the products are nearly ready to launch. Other companies including BlackRock Inc., Fidelity Investments, 21Shares and Invesco also have filings awaiting approval.
Related
Many issuers have yet to disclose fees on their respective funds, which is required before trading can begin.
Will the price follow?
Ether has underperformed Bitcoin for over a year, with Bitcoin posting strong gains bolstered by over $14 billion in flows into its spot ETFs in 2024.
Related
The planned launch of ETH ETFs on July 8 could be a “golden egg” for Ether price action. However, Bitcoin is likely to face selling pressure as $8.5 billion is returned to creditors of bankrupt exchange Mt. Gox starting this week, according to a report from analysts at K33.
The 100 EMA often serves as a reliable indicator of the overall trend, and a break below it could trigger a selloff. Having currently regained the critical $3,000 level, Ether now needs to reclaim the 3,360 support level before July 8. If it fails, the short-term rally could be halted for good.