Ethereum ETFs (exchange-traded funds) began trading on Tuesday, generating significant volume in the first 2 hours of trading. Interestingly, Ethereum ETFs ranked in the top 1% of ETF Volume.
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Ethereum ETFs surpass traditional launch volumes
According to According to Bloomberg ETF expert Eric Balchunas, ETH ETFs traded $361 million in the first 90 minutes of launch day, surpassing the typical volume seen in traditional ETF launches. Balchunas said:
Here’s where we are after 90 minutes. Total of $361 million. As a group, that number would rank them 15th overall in ETF volume (about what $TLT and $EEM trade), which is Top 1%. But then again, compared to a normal ETF launch, which rarely exceeds $1 million on the first day, they all surpassed that number and then some.
Matthew Sigel, head of digital asset research at asset manager VanEck, highlighted the significance of these numbers in the first few hours of trading, noting that Ethereum ETFs had over 50% of the trading volume compared to Bitcoin’s $610 million on the first day, indicating strong investor interest in Ethereum.
However, it remains to be seen how these numbers will play out in the end. Bitcoin ETFs have seen $4.6 billion in volume on its first day of trading in January, which could indicate the future performance of these newly approved index funds for the second-largest cryptocurrency on the market.
ETH Price Targets Soar
Crypto analyst Doctor Profit shared a report Highlighting a potentially massive parabolic move for the price of Ethereum this year, on the back of expected inflows into the new Ethereum ETF market.
While some anticipate a correction due to the “sell the news” phenomenon, Doctor Profit argues that the market has already factored in the ETF launch but has not yet factored in the significant inflows of US dollars that will flood into Ethereum ETFs.
With Ethereum market value Being three times smaller than Bitcoin, Doctor Profit believes that every dollar invested in ETH should have three times the price impact compared to Bitcoin, positioning Ethereum favorably for substantial price gains.
Furthermore, the analyst claims that while the selling pressure on Ethereum’s Grayscale ETH Fund is comparable to that of the Bitcoin ETF launch, the impact is expected to be less severe.
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Looking to the future, Doctor Profit has defined the expected price targets for Ethereum in the coming months, including a potential target between $4,500 and $5,500 by Q3 2024, indicating steady but modest growth.
Moving into Q4 2024 and Q1 2025, the price range is expected to expand from $5,500 to $8,000. However, Q2 2025 is where Ethereum is expected to jump significantly, with price targets ranging from $8,000 to $14,000.
At the time of writing, ETH was trading at $3,444, showing a sideways movement with no significant change from yesterday’s price despite the hype surrounding the launch of the ETF market.
Featured image of DALL-E, chart from TradingView.com