Although Ethereum (ETH) has recovered significantly from its 2022 lows, a new report from crypto analytics firm Kaiko shows that the real hype surrounding ETH has not really begun yet. This is in contrast to Bitcoin (BTC), which has benefited greatly from the hype surrounding the approval of BTC ETFs in the US. When can we expect ETH to come back into the spotlight?
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Ethereum ETFs?
Interestingly, the US Securities and Exchange Commission (SEC) recently decided to postpone its decision on the spot market ETF application for banking giant Fidelity's Ethereum ETF until March. According to Kaiko, there is some excitement surrounding the ETH ETF applications, but the data shows that aggressive speculation has not really begun yet.
“ETH trading volume has increased, but derivatives markets are lacking signs that traders are gearing up for a rally. ETH futures ETFs also had a few weak months.”
Kaiko also states that the correlation between BTC and ETH is currently historically low. This is also related to the approval of Bitcoin spot ETFs. According to Kaiko, it is still doubtful whether the launch of spot ETFs for Ethereum will be as important. In fact, we first have to see whether such ETFs even get the green light from the SEC.
Ethereum can write its own history
However, Kaiko emphasizes that Ethereum has multiple storylines; If ETFs don't generate excitement, perhaps new Layer 2 solutions or the success of EigenLayer and Restating will.
The world's largest bank, JPMorgan, does not estimate the likelihood of Ethereum spot ETFs coming to market any time soon. The SEC will release more on this toward the end of May, but according to JPMorgan, the chance of Ethereum ETFs being approved is less than 50%. If you believe this bank, it will be some time before Ethereum also gets spot ETFs.
The hype is therefore a little behind. But as Kaiko points out in the report, Ethereum has more to look forward to than just the launch of ETFs. Furthermore, there is a possibility that these investment products will still come onto the market sooner or later, with all the hype that comes with it.
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