Ethereum ETFs Could Propel ETH to New All-Time High Above $5,000, Experts Predict

by muhammed July 17, 2024

written by muhammed July 17, 2024 5 minutes read

Ethereum Set for New All-Time High: Peter Brandt, Bitwise

Ethereum (ETH) is on track for a new all-time high, according to experts like Peter Brandt and Bitwise. They believe Ethereum ETFs could push ETH above $5,000.

Bitwise’s Prediction

Matt Hougan, the chief investment officer (CIO) of Bitwise, is confident that Ethereum ETFs will boost ETH’s price to a new all-time high. He predicts that by the end of the year, Ethereum could surpass $5,000 if the demand from ETFs is strong. Hougan compares this to the impact Bitcoin ETFs had on Bitcoin (BTC), which saw a 110% rise after the SEC approved Bitcoin ETFs.

Citi Bank’s Forecast

Citi Bank also predicts that Ethereum ETFs will attract significant investment. They estimate that ETFs could bring in around $5 billion in net inflows within six months. This would be about 30%-35% of what Bitcoin ETFs achieved. Citi analysts believe this influx will help push ETH prices higher.

Peter Brandt’s Analysis

Peter Brandt, a well-known trader, suggests that Ethereum could rally by 60% if it reaches a key support level. He believes that if ETH can move past $4,093, it could hit a new all-time high of $5,627. Currently, ETH is trading around $3,460, up 2% from the previous day.

SEC Approval and Market Impact

The SEC is expected to approve Ethereum ETFs soon. Bloomberg and Reuters report that the SEC has asked issuers to submit their final drafts, indicating a possible launch on July 23. This approval is likely to attract new investors and boost ETH prices.

Ethereum’s Deflationary Status

Ethereum has been deflationary since the implementation of Ethereum Improvement Proposal 1559 (EIP-1559). This proposal reduces the amount of ETH in circulation with each transaction. Matt Hougan explains that with no new supply and increasing demand, Ethereum’s price is poised to rise. The low inflation rate of ETH, compared to Bitcoin’s 1.7% rate, is another factor supporting this prediction.

Impact of Staking and DeFi

Ethereum staking and DeFi protocols are also reducing the amount of ETH available on the market. More than 40% of ETH has been taken off the market due to staking and its use in DeFi. Hougan highlights that this reduction in supply, combined with new demand from ETFs, creates a favorable situation for Ethereum’s price increase.

Comparison to Bitcoin ETFs

Hougan believes that Ethereum ETFs will have a bigger impact on ETH than Bitcoin ETFs had on BTC. This is because ETFs bring new demand without changing the fundamentals of the asset. Bitcoin’s rise due to ETFs is a positive indicator for Ethereum’s potential.

Technical Analysis and Market Trends

Ethereum’s technical indicators suggest a potential rally. ETH’s options open interest has risen 13% in the past 24 hours to $6.66 billion. An increase in open interest, combined with price growth, indicates that traders expect higher prices. This aligns with Peter Brandt’s analysis and the predictions from other experts.

Market Activity and Liquidations

In the past 24 hours, Ethereum has seen significant market activity with over $45 million in liquidations. Short positions lead with $25.36 million, while long positions account for $19.92 million. If ETH rises above $3,502, another $34.8 million worth of short positions could be liquidated, further pushing the price up.

Economic Factors and Selling Pressure

Ethereum’s consensus mechanism has a lower economic cost compared to Bitcoin’s. This reduces the selling pressure on ETH because miners don’t need to sell as much of their holdings to cover costs. This is another factor that supports the potential for ETH’s price to reach new highs.

Conclusion

Experts are optimistic about Ethereum’s future. With the expected approval of Ethereum ETFs, reduced supply from staking and DeFi, and strong technical indicators, ETH seems poised to reach a new all-time high. Both Bitwise and Citi Bank have made strong predictions, and traders like Peter Brandt see significant potential for a price rally. As market conditions and investor interest align, Ethereum could soon surpass $5,000.

muhammed

Muhammed is a passionate crypto blogger, tech enthusiast, and skilled software engineer who has established himself as a significant voice in the cryptocurrency and blockchain community. Muhammed’s fascination with technology and coding began at an early age. His parents, both techies, encouraged his curiosity, providing him with the tools and resources to explore the digital world. Muhammed’s academic journey laid a strong foundation for his career. He pursued a Bachelor's degree in Computer Science. During his time there, Muhammed immersed himself in various aspects of software development, cybersecurity, and cryptographic algorithms. He developed a project with friends, a decentralized application (DApp) for secure data sharing, received widespread acclaim and sparked his deep interest in blockchain technology and preventing digital censorship. After graduating, Muhammed worked as a software engineer for several leading tech companies, where he gained hands-on experience in developing scalable software solutions and working with cutting-edge technologies. His professional journey took a pivotal turn when he discovered Bitcoin and blockchain technology. Fascinated by the potential of decentralized systems to revolutionize finance and various other industries, Muhammed began to delve deeper into the world of cryptocurrencies. Combining his technical expertise with his growing passion for blockchain, Muhammed launched his blog and telegram channel where he shared his knowledge and insights on the latest trends, technologies, and market movements in the cryptocurrency space. His blog quickly gained traction, attracting a diverse audience ranging from tech-savvy developers to novice investors. Muhammed’s ability to break down complex technical concepts into easily understandable content has made his blog a go-to resource for many. In addition to blogging, Muhammed actively contributes to open-source projects, where he collaborates with other developers to improve the security and functionality of various platforms. His contributions have earned him recognition in the developer community, and he frequently participates in hackathons and tech meetups, sharing his expertise and learning from peers. Muhammed’s dedication to educating others about cryptocurrency extends beyond his blog. He has written articles for prominent tech and financial publications. His pieces often explore the practical applications of blockchain technology, the future of decentralized finance (DeFi), the evolving regulatory landscape and digital privacy and online censorship. What sets Muhammed apart is his relentless curiosity and his commitment to continuous learning. He believes that blockchain technology is still in its early stages and that its full potential is yet to be realized. This belief drives him to stay at the forefront of technological advancements and to share his knowledge with the broader community. Outside of his professional endeavors, Muhammed is an avid gamer and enjoys exploring the latest in gaming technology and virtual reality. He is fluent in Turkish, Arabic and English. His blend of technical expertise, passion for blockchain, and dedication to education make him a unique and influential figure in the crypto community, inspiring many to explore the transformative potential of decentralized technologies.