The cryptocurrency market has been buzzing with the recent approval of an Ethereum ETF, sparking discussion and speculation among investors and analysts alike.
Since the Ethereum ETF was approved last week, Ethereum has soared to $3,959 so far and is currently trading at $3,757.
Reaching $3,900 represents a significant increase, but falls short of the dramatic surge many are expecting following the US SEC’s approval of the spot ETF.
Is Spot Ethereum ETF Approved Priced?
According to recent reports, experts are divided on whether the impact of these approvals has been fully priced out of the market.
DeFiance Capital’s Arthur Cheong discussed this, noting that the market has not yet adapted to these significant changes and such major changes in market dynamics cannot be immediately reflected in prices.
GSR’s Brian Rudick agrees that the pattern observed with the spot Bitcoin ETF could be repeated with ETH, with significant price movements following anticipation of a spot ETF launch and the actual launch of the spot ETF.
Despite Ethereum’s recent rally, the consensus among market experts is that the potential for ETF approval may not yet be priced in.
Rudick stated that the future price of ETH will likely depend on inflows into the newly launched spot Ethereum ETF, similar to the trend observed for Bitcoin. He predicted that strong inflows into these ETFs would likely push Ethereum prices “up 50-100%” from earlier this month.
Meanwhile, Tranchess’s Danny Chong considers the approval to be only partially “priced in.” He expects significant volatility and potential “sideways trading” in the near term as markets adapt to “fluctuating supply and demand dynamics.”
Chong emphasizes that a spot ETH ETF could drive institutional adoption and stabilize the long-term price of Ethereum.
Experts predict that the market capitalization of the ETF will reach $1.8 trillion after approval.
Meanwhile, Michael Nadeau, founder of The DeFi Report, recently analyzed the potential impact of the approval of an Ethereum spot ETF on the market trajectory.
Nadeau outlined a valuation framework that suggests the entire cryptocurrency market could achieve a market capitalization of $10 trillion. He believes ETH is poised to exceed 10-20% of Bloomberg’s estimated Bitcoin net inflows.
According to his predictions, ETH could achieve a market capitalization of $1.8 trillion at the peak of this cycle, and assuming supply remains constant, the price of ETH could rise to around $14,984.
For comparison, he points out that if Bitcoin achieves a market capitalization of $4 trillion, its price could soar to $202,000.
Featured image created with DALL-E, chart from TradingView