Despite a recent downturn in Ethereum‘s (ETH) market price, cryptocurrency experts remain bullish about its potential growth in the coming months. This optimism persists even as the potential rejection of an Ethereum-based Exchange Traded Fund (ETF) looms in the United States, which some believe will not detrimentally impact ETH’s value.
Market Dynamics Suggest Minimal Impact from ETF Decision
Jupiter Zheng from Hashkey Capital suggests that the market has not yet priced in the approval of an Ethereum ETF, indicating that a rejection may not necessarily prompt a sell-off. Zheng further posits that, should an ETF gain approval, the market could see a surge in ETH price due to the liquidation of significant short positions. Recent data reveals substantial liquidations for both long and short ETH positions, with notable figures in the last 24 hours. Despite this, Zheng believes that these liquidations will not markedly affect the Ethereum futures market’s current open interest.
Confidence in an ETF approval has also been shaken by the U.S. Securities and Exchange Commission’s (SEC) ongoing scrutiny of the Ethereum Foundation. The SEC’s previous attempts to classify ETH as a security and its subpoenas to Ethereum Foundation associates have added to the perceived hurdles for ETF approval.
Upcoming Bitcoin Halving Could Fuel Ethereum’s Ascent
Some analysts are drawing parallels between ETH’s current price patterns and those observed prior to the last Bitcoin reward halving event. They anticipate that the forthcoming Bitcoin halving might replicate the scenario that led to a significant hike in ETH price in 2020. In that instance, Ethereum experienced a substantial growth in value in the months following the halving. Technical analysis by experts has identified a bullish formation on the Ethereum price chart, hinting at a prospective upward trajectory.
Implications for the Reader
- Rejection of an Ethereum ETF might not result in a large-scale ETH price drop.
- Approval of an Ethereum ETF could induce a price hike through short position liquidation.
- Anticipated Bitcoin halving may act as a catalyst for Ethereum’s price increase.
In conclusion, Ethereum’s price resilience is supported by expert analyses, which suggest a low likelihood of a downturn from a potential ETF rejection and potential growth triggers on the horizon.