According to a new report from Kaiko, Ether could outperform Bitcoin following the launch of a much-anticipated Ethereum exchange-traded fund (ETF) in the United States.
The report highlighted the Ether (ETH) to Bitcoin (BTC) price ratio, which is a measure of how much BTC it takes to buy 1 ETH. The higher this ratio, the higher the Ether price relative to Bitcoin, and vice versa.
The ratio is currently at 0.05, down from 0.045 before the U.S. Securities and Exchange Commission (SEC) approved a spot Ether ETF.
Ether’s 1% market depth was also mentioned in the report as a potential catalyst for the upcoming ETH bull market. Market depth measures the amount of liquidity in a market. The lower the liquidity of an asset, the higher the volatility, while the higher the liquidity, the more stable the market price is when faced with large orders.
This low market depth is supported by Ethereum Exchange Reserves, a metric that tracks the amount of Ethereum available for purchase on exchanges. This metric is at a multi-year low, which means there could be a supply shock due to institutional investors filling Ethereum ETF positions, potentially driving prices up significantly.
Ethereum ETF is imminent
All eyes are on the launch of a spot Ethereum ETF, and analysts say it could happen soon. Eric Balchunas, chief analyst at Bloomberg ETFs, continues to predict a July launch window. According to Balchunas, the SEC has asked applicants to file an amended S-1 form by July 16, ahead of the July 23 launch date.
Related: Whale Transfers $50 Million Worth of ETH Amid ETF Expectations
Institutional investor Tom Dunleavy recently told Cointelegraph that he expects Ethereum ETFs to see inflows of $1 billion per month, totaling $10 billion.
Regulatory Controversy
Ether’s status as a commodity or security has been hotly debated in regulatory circles. In June, the SEC dropped its investigation into the smart contract protocol, likely to avoid embarrassment, according to Conensys attorney Laura Brookover.
Recently, Commodity Futures Trading Commission (CFTC) Chairman Rostin Venum asserted that ETH is a commodity and falls under the agency’s jurisdiction.
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