Ethereum
Will Ethereum Spot-ETF Approval Trigger a 30% Ether Price Drop? Bitcoin and other crypto-related stocks react negatively in premarket amid fears
Crypto-related stocks including Global Coinbase (NASDAQ: COIN), MicroStrategy Inc. (NASDAQ:MSTR), Marathon Digital Funds (NASDAQ: MARA) and others have shown muted reactions to Nate Geracipresident of The ETF Institutewhile waiting for approvals for the spot Ethereum (CRYPTO: ETH) this week. However, analysts are considering the impact of the ETF on the price of ETH.
What happened: Launch of spot Ether exchange-traded funds (ETFs) could potentially lead to 30% drop in Ether price, warns Andrew Kangfounder and partner at Capital Mechanism. Kang suggests that the price of Ether could fall from its current value of $3,410 to $2,400, CoinTelegraph reported on Monday.
At the time of writing on Monday, Coinbase was trading down 3.70% at $217.50 after closing at $225.86 on Friday, while Robinhood Markets, Inc. (NASDAQ: HOOD) was trading down 1.97% at $21.85 after closing at $22.29 on Friday. Similarly, Marathon Digital was down 5.15% since its close at $19.21 and was trading at $18.22 while MicroStrategy was trading down 5.68% at $1,399.50 after Friday’s close at $1,483.76. Riot Platforms, Inc. (NASDAQ:RIOT) also reacted to the conversation by trading down 3.87% to $9.180 in pre-market trading.
Kang expressed skepticism about the potential benefits of an Ether ETF in a recent article. He said: “What benefit would an ETH ETF offer? I wouldn’t say much,” predicting a price range of $2,400 to $3,000 after the ETF launch.
Kang predicts that spot Ether ETFs will only attract 15% of spot flows. Bitcoin (CRYPTO: BTC) ETFs saw it. This is in line with the 10-20% range estimated by Bloomberg ETF analysts. Eric Balchunas And James Seyffart.
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However, not everyone agrees with Kang’s predictions. Industry Analyst Patrick Scott expects a similar directional move as Bitcoin spot ETFs, but he does not expect the price of Ether to double. Meanwhile, the asset management company VanEck projects that spot Ether ETFs could drive Ether to $22,000 by 2030.
Kang also expressed concerns about Ethereum’s future as a cash flow “machine”, suggesting that Ethereum could look like an overvalued tech stock. He also noted that removing staking from the proposed spot Ether ETFs could deter investors from converting their spot Ether into ETF form.
Why is this important: The launch of spot Ether ETFs has been a topic of discussion in the crypto world. Nate Geraci, chairman of the ETF Institute, previously predicted the approval of Ethereum spot ETFs, which could potentially shake up the cryptocurrency market.
In a post on
Geraci’s views were consistent with his forecast two weeks ago when he said he would be shocked if spot ETFs didn’t receive green signals before the end of the month. “No reason to delay,” he said.
It also follows a controversial policy shift that led to the SEC’s approval of Ethereum spot ETFs last month, a narrative that was called into question after President Joe Biden vetoed a bill to overturn SAB 121.
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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari