Cryptocurrency analysis company QCP Capital recently shared its views on the volatility and future prospects of Bitcoin (BTC) and Ethereum (ETH).
QCP Capital noted that BTC volatility, which was 75% during the BTC spot ETF approval period, has now dropped to 40%. BTC fell rapidly from its high of $49,100 following ETF approval and settled in the $39-43 thousand range.
Price rallies were pulled back by GBTC outflows and declines were absorbed by inflows to other ETFs and general accumulation ahead of the halving. According to analysts, this situation caused the volumes to drop to 40% and the BTC volume curve to switch from a downward slope to an upward slope today.
Looking ahead, the company noted that the historically bullish halving, which occurs every four years in April/May, is on the horizon. As we move towards this event, the market appears to be in accumulation mode, according to analysts. Other ETFs other than GBTC continue to see reasonable inflows. Funding also remains fairly neutral, reflecting the moderation of speculative positioning.
QCP Capital: “After Ethereum ETF, ETH Price May Have a Similar Reaction to Bitcoin”
Following the BTC spot ETF approval, the ETHBTC exchange rate rallied 20% from .05 to .06 in anticipation of potential approval for the spot ETH ETF. The company predicts that ETH could make the same move as BTC (i.e. rise before the ETF and sell off after), especially considering that the ETHE ETF manages $6 billion in assets.
However, there is a lot of uncertainty around the ETH spot ETF because the Proof-of-Stake mechanism could place ETH in a different asset classification than BTC. More uncertainty can also mean more volatility.
*This is not investment advice.
