SEC made an important decision yesterday, in line with expectations, and approved spot Ethereum ETF applications.
While expectations for an increase in the ETH price increased after this approval of the SEC, the prices of Bitcoin (BTC) and Ethereum fell in the last 24 hours despite the approval news.
Evaluating this decline, FxPro senior analyst Alex Kuptsikevich stated that the decline in ETH price turned into a “news selling” event after the ETH ETF approval.
Predicting that the price decline in ETH may continue at this point, Kuptsikevich argued that institutional investors could start accumulating ETH after this withdrawal.
“Ethereum surged following positive news earlier in the week, but its decline following ETF approval is a reflection of ETH selloff and a typical “buy the rumor, sell the news” response.
We should not be surprised if the price retreats back to the $3000 region and turns into a significant consolidation area.
“At these levels, large institutional investors can start building positions in ETFs.”
Pointing out that the same situation occurred after the Bitcoin ETF approval, he said, “We saw the same after the approval of the Bitcoin ETF in January. Bitcoin dropped 19% in price before a spectacular comeback in the two weeks after the approval.” said.
Analysts expect significant institutional capital inflows if Ethereum ETFs become available for trading. At this point, Standard Chartered predicts that there may be up to $45 billion inflow into ETH ETFs in the first 12 months.
*This is not investment advice.