Let’s dive deep into the recent crypto drama! Last week, while the crypto market was taking a nosedive, something peculiar happened. Ether (ETH), Ethereum’s native token, seemed to have its own umbrella, taking more minor losses than the industry leader, Bitcoin (BTC). But why? Analysts are scratching their heads; the theories are as diverse as a crypto rainbow.
The ETH/BTC ratio rose, even as the broader market had a meltdown. Some analysts believe that Ether’s surprising resilience came from the optimism surrounding the potential launch of futures-based ETFs. Imagine a world where Ether gets its own ETF spotlight! Noelle Acheson, the genius behind the “Crypto Is Macro Now” newsletter, thinks the ETH market is waking up to this possibility. She says, “It looks like the ETH market is finally starting to wake up to the likelihood of an ETH futures ETF come October.” And if that happens? It could be a game-changer, offering retail and institutional investors a new way to dive into crypto.
But wait, there’s more! Futures-based ETFs aren’t just any ETFs. They’re publicly traded securities that track the price movement of an asset’s futures contracts. If Ether gets its version, it will mimic its performance, much like ProShares’ Bitcoin Strategy ETF does for Bitcoin. And speaking of ProShares, since its inception in October 2021, it has closely tracked Bitcoin’s spot price, attracting $2 billion in investor money. If Ether gets its own ETF, the sky’s the limit!
However, only some people are on the Ether-ETF train. Markus Thielen, the big brain at crypto services provider Matrixport, thinks Bitcoin’s decline concerns a lack of interest in Ether and other altcoins. He points out that the crypto market has become dry, with many market makers stepping back. This has led the big players to focus more on Bitcoin, leaving altcoins in the dust.
And then there’s Griffin Ardern, a volatility trader from Blofin, who believes that the hedging activity of ETH options market makers played a significant role in Ether’s outperformance. He says, “For BTC, I think market makers’ hedging contributed to the price drop, but for ETH, it was a key factor that prevented the price from falling sharply.”
