The post Can Spot ETFs Push Ethereum’s (ETH) Price Beyond $4,000? appeared on BitcoinEthereumNews.com.

Ethereum (ETH) has been experiencing volatility mainly due to its alignment with broader market trends. Despite the approval of spot ETH ETFs, the event has not yet impacted the price. However, this could change in the near future. Do Ethereum ETFs Have a Bright Future? Spot ETF movements might substantially impact Ethereum’s price in the coming few months. Earlier this week, the US Securities and Exchange Commission (SEC) approved listing spot ETFs by the beginning of July. This has increased investors’ expectations massively. “We expect the net inflows into ETH ETFs to be 20-50% of the net inflows into BTC ETFs over the first five months, with 30% as our target, implying $1 billion/month of net inflows,” Galaxy Research Team’s Vice President Charles Yu stated. However, this optimistic forecast does not look entirely realistic. To put it into perspective, spot Bitcoin ETFs have only seen $857 million in inflows as of June 21, despite holding 84% of the entire ETF market share, with futures ETFs accounting for just 14%. This raises doubts about whether spot Ethereum ETFs will achieve $1 billion in monthly inflows. Read more: Ethereum ETF Explained: What It Is and How It Works Spot Bitcoin ETF Market Share. Source: TheBlock The uncertainty regarding the success of ETH ETFs in a relatively bearish market could also lead to a surge in market makers’ premiums. Gamma distribution risk, involving the sensitivity of options to price changes, makes market makers adjust their strategies. With the added uncertainty of ETH ETFs, they are likely to raise premiums to cover potential extreme price swings.  “ETH can still obtain effective support from market makers hedging on the downward path. As one of the solutions to the above-mentioned gamma distribution risk, market makers have also slightly raised their pricing for tail risk. Due to…

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Filed under: News - @ June 29, 2024 3:22 pm