Will the spot ETF be a game-changer?

Will the spot Ether ETF approval finally break Ethereum’s price stagnation and trigger a significant rally? Insights and analysis.

Ethereum (ETH) price predictions are buzzing with speculation, fueled by the possibility of a spot Ethereum exchange-traded fund (ETF) going live next month. 

Amid the current volatility in the crypto market, ETH has experienced a cooling effect, declining by over 4% in the last week and trading at around $3,500 as of June 17. 

Ethereum price teeters on the edge: will the spot ETH ETF approval trigger a massive rally? - 1
ETH one-month price chart | Source: CoinMarketcap

This dip in Ethereum’s price mirrors a broader trend where Bitcoin (BTC) and other altcoins have struggled to maintain bullish momentum, resulting in recent retracements. 

Interestingly, while BTC has declined by over 2% in the past 30 days, currently trading between $65-66k levels, ETH has managed to gain over 12% in the same period.

Ethereum price teeters on the edge: will the spot ETH ETF approval trigger a massive rally? - 2
ETH vs BTC one-month price chart | Source: CoinMarketCap

On May 23rd, the SEC approved eight 19b-4 filings to list spot Ether ETFs on various U.S. exchanges. However, trading cannot commence until the required S-1 registration statement approvals are in place, which has provided bullish momentum to ETH’s price. 

In a recent update, Bloomberg ETF analyst Eric Balchunas mentioned that spot Ether ETFs could potentially begin trading as early as July 2nd. 

Balchunas shared on X (formerly Twitter) that the U.S. Securities and Exchange Commission (SEC) staff comments on the spot Ether ETF applicants’ S-1 applications were “pretty light, nothing major,” and they were asked to resubmit within the week. 

Balchunas suggested that, while anything is possible, this timeline seems plausible based on current information. 

However, on June 13, SEC Chair Gary Gensler provided a broader timeframe, indicating that spot Ether ETFs might start trading by the end of September, depending on how swiftly issuers can address SEC comments.

Amid these mixed reactions, what is happening with ETH price, and what does market sentiment suggest about Ethereum price predictions? Let’s find out.

Whale activity and TVL data

As the possibility of a spot Ether ETF draws closer, whales are making moves that could heavily influence current price action. 

In a tweet on June 16, ali_charts reported that Ethereum whales have purchased over 700,000 ETH in the past three weeks, totaling approximately $2.45 billion. 

Another tweet from a crypto analyst noted that the number of Ethereum addresses holding more than 10,000 ETH has increased by over 3% in the last four weeks. 

To put this into perspective, data from Dune Analytics shows that the top 1,000 ETH holders control 38.93% of the total ETH supply. Among them, the top 100 holders alone possess 21.34%, while the top 500 holders command 33.86%.

Amid this whale activity, Ethereum’s Total Value Locked (TVL) remains strong, commanding over 61% of the total TVL share in the crypto market. As of June 17, Ethereum’s TVL stands at $62.186 billion, more than double the $30 billion at the start of the year. 

Ethereum price teeters on the edge: will the spot ETH ETF approval trigger a massive rally? - 3
ETH TVL data | Source: DeFi LIama

Leading the charge is Lido, ETH’s liquid staking platform, which has seen a 14% increase in TVL over the past month, reaching $33.64 billion. 

Following closely is the ETH restaking platform Eigenlayer, with a massive 25% increase in its TVL, now over $19 billion.

The implications of these whale movements and the strong TVL figures are profound. If the spot Ether ETF is approved, it could attract even more retail and institutional investment, driving prices and TVL levels higher. 

Meanwhile, the whales’ recent accumulation suggests they are positioning themselves for this potential surge, betting on the possibility that spot ETH ETFs will go live soon.

What do the experts think?

Michaël van de Poppe, a well-respected analyst, mentioned the potential launch of spot Ethereum ETF as a major market event. 

He notes that the approval of the 19b-4 files led to a substantial rally in ETH prices, with a single-day surge exceeding 20%, pushing ETH to $3,800. However, this initial excitement was tempered by a subsequent 10% price decline as the market awaits the approval of the S-1 files. 

Van de Poppe suggests that this period of uncertainty might be a classic “Sell the Rumor, Buy the News” scenario, with the ETF approval potentially signaling a broader acceptance of Ethereum as a commodity, thereby benefiting the entire ecosystem.

In a similar vein, EmperorBTC provides a swing trader’s perspective, hinting at the bullish implications of the ETH ETF announcement for the entire crypto market. 

He suggests that the ETF will provide a new use case for Ethereum, which could lead to a significant influx of capital into not only ETH but also other altcoins. 

His perspective aligns with the idea that the recent price retrace was necessary to shake out impatient investors, setting the stage for a strong accumulation phase and subsequent price surge, potentially mirroring the 2020 Bitcoin halving event.

Another analyst drew parallels between the expected ETH ETF and the earlier Bitcoin ETF approvals. 

The launch of Bitcoin ETFs initially led to a short-term price dip, largely due to the “sell the news” phenomenon and the impact of Grayscale’s GBTC selling. 

However, in the long term, BTC ETFs have been a net positive for Bitcoin prices. The analyst believes that while there might be a similar initial dip for ETH due to market shock and the Grayscale ETHE product, the long-term outlook remains bullish. 

This is partly because the ETHE discount has already narrowed, reducing the potential for significant sell-offs once the ETFs go live.

ETH price prediction: long-term view

According to a crypto analyst, based on technical analysis, ETH is currently trading within a bull flag or parallel channel. 

A breakout above the $4,000 resistance could trigger a strong bullish move, potentially pushing prices towards the $6,000-$7,000 range. Conversely, if ETH breaks down below the support level at $3,650, a decline towards $3,152 could occur.

When it comes to Ethereum price prediction based on algorithmic forecasting websites, there are varied perspectives on where ETH might be headed in the coming years. 

According to Priceprediction.net, Ethereum price prediction for 2024 suggests ETH could reach around $4,947. On the other hand, Digitalcoinprice is more optimistic, predicting a higher price of $7,365 for the same year.

Looking ahead to mid-decade, Ethereum price predictions for 2025 also show variation. Priceprediction.net anticipates ETH could rise to $6,847, while Digitalcoinprice forecasts a potentially higher figure of $8,971 by 2025.

The long-term Ethereum price prediction for 2030 diverges significantly. Priceprediction.net projects a staggering $46,089, whereas Digitalcoinprice offers a more conservative estimate of $24,786 for 2030.

Algorithmic forecasts provide useful insights but are inherently speculative and subject to various market factors. You should be aware of the risks and uncertainties involved. 

Remember, never invest more than you can afford to lose. The crypto market is highly volatile, and prices can fluctuate dramatically. 

It’s crucial to do your own research, stay informed, and make decisions based on your risk tolerance and investment goals.

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