Ethereum (ETH) had plummeted at the beginning of 2023. However, by the start of 2024, things began to improve. The price increased by approximately 50% from January 1st and surpassed $4,000 by March. But in the last 30 days, a 11% drop caused concern in the market.
Analyst’s Ethereum Commentary
Despite the recent drop in Ethereum’s price, a well-known crypto analyst, degentrading, painted an optimistic picture, predicting that Ethereum would reach $6,000 by September 2024.
The analyst’s prediction emerged in response to a post by Mechanism Capital’s founder Andrew Kang. Kang is known for his cautious approach to the upcoming entry of Ethereum spot exchange-traded funds (ETFs) in the US market.
How Can Ethereum Rise?
Degentrading’s bullish outlook is based on several key factors. One of the most significant is the $5 billion increase in CME open interest from low levels seen before the ETF news.
This potential ease in trading could open the door for significant capital to enter the market through Ethereum.
Another point of interest is the liquidity comparison between Ethereum and Bitcoin. Ethereum’s market value is just over $400 billion, about one-third of Bitcoin’s approximately $1.2 trillion. However, Ethereum’s liquidity is only 10% of Bitcoin’s.
Therefore, a few billion dollars of cash flow into Ethereum could visibly change its price.
One of the most important factors that could affect Ethereum’s price is the start of trading for the spot Ethereum ETF. Recent reports suggest that these ETFs could be approved in the first week of July, with over $500 million expected to flow in within the following six months.
Degentrading also highlighted a significant point, suggesting that Grayscale’s Ethereum Trust (ETHE) could be converted into an ETF, similar to the scenario with Bitcoin.
How Much is 1 Ethereum?
Aside from the analyst’s views, attention was on Ethereum’s price today. Recent opinions suggested that the potential start date for Ethereum ETF trading could be in the first week of July.
Following the news, Ethereum’s price reversed its decline and reached a neutral stance. As of the time of writing, the price is $3,380, reflecting a 0.20% increase in the last 24 hours.
Ethereum’s market cap reached $406 billion and remains above $400 billion. Meanwhile, the trading volume was $11.69 billion after a 10.66% drop, indicating still-low investor interest.
It remains to be seen whether Ethereum’s price will experience a decline similar to Bitcoin’s if the Ethereum ETF starts trading next month.
