Analyst: Approval of Ethereum ETF in Q3 Could Trigger Crypto Bull Run
An analyst from Bitfinex has stated that the approval of U.S. spot ether exchange-traded funds (ETF) in the third quarter could potentially lead to a significant increase in positive momentum in the crypto market, resulting in a bull run. This regulatory approval could further strengthen the recent positive trend in digital assets.
The analyst also highlighted that the first-quarter economic activity suggests a slowdown in momentum, which has raised expectations of a potential rate cut by the Federal Reserve this year. The appetite for riskier assets, such as Bitcoin, may fluctuate due to these economic conditions, resulting in uneven flows into ETFs that track these assets. This, in turn, could impact investor sentiment.
Bitfinex analysts estimate that Bitcoin could benefit from the halving event in April, as historical patterns indicate that a bull market usually begins 10-12 weeks after miners’ rewards are reduced. Additionally, the potential launch of an Ethereum ETF in the third quarter could further amplify this positive momentum for the crypto market. They anticipate increased volatility in both traditional and crypto markets in July due to regulatory developments and macroeconomic policies.
The approval of spot Ether ETFs is expected to attract significant institutional investment. Many large financial institutions and asset managers have been hesitant to directly invest in crypto due to regulatory uncertainties and the complexities involved in holding digital assets. However, a regulated ETF would provide a familiar and compliant investment vehicle for these entities to gain exposure to Ether. The Bitfinex analyst emphasized that the approval of spot Ether ETFs could act as a major bullish signal for the crypto market and potentially lead to a surge in Ether’s price.
SEC Chair Gary Gensler recently stated that the progress of launching the first spot Ether ETFs is going smoothly. This indicates that the regulatory landscape is becoming more favorable for the crypto industry.
Looking ahead to July, market participants should expect increased volatility in both traditional and crypto markets. Additional regulatory developments and macroeconomic policies will play a crucial role in shaping market dynamics. Investors should pay attention to economic data releases and updates on Fed policies, as these factors can influence the performance of both traditional and crypto markets. The market is still anticipating and pricing in two rate cuts in 2024, and the Fed’s statements and a possible continuation of a more hawkish stance will be important to monitor.
In summary, the potential approval of an Ethereum ETF in the third quarter could have a significant impact on the crypto market, potentially triggering a bull run. Increased volatility is expected in July, and market participants should closely watch regulatory developments and macroeconomic policies for market insights.