Research from analytics firm Kaiko indicates that the ether-to-bitcoin ratio, a key metric comparing the two cryptocurrencies, has been rising since the approval of the ETFs in May. The ratio increased from 0.045 to 0.05, suggesting that it takes more bitcoin to purchase one ether token. This trend is expected to continue as the ETFs become available for trading, reinforcing ether's potential upside.
Wall Street analysts are particularly bullish on ether due to its unique attributes, such as an annual yield and greater functionality compared to bitcoin. These features are anticipated to drive higher demand for ether, further enhancing its market performance. Additionally, the upcoming ETFs are predicted to face fewer challenges than spot bitcoin ETFs, making them more attractive to investors.
CME Group reported a notable increase in trading activity related to the ether-to-bitcoin ratio futures in the second quarter. The notional value traded exceeded $260 million, with ether futures achieving record open interest and trading volumes. This surge in trading activity underscores the growing interest in ether as a leading cryptocurrency.
Rachel Lin, CEO of SynFutures, highlighted that the supply dynamics of ether could further tighten its price ratio with bitcoin. She projected a substantial price increase for ether, potentially reaching $22,500, which would represent a 550% rise from its current levels.
Standard Chartered analysts also pointed out that the ether ETFs are likely to experience fewer outflows compared to their bitcoin counterparts, reducing the risk of forced selling. This stability is expected to contribute to ether's stronger market performance.
Ether's current price is approximately $3,450, reflecting a year-to-date increase of over 51%. The anticipated debut of the spot ether ETFs, combined with favorable market conditions and unique features, positions ether as a strong contender to outperform bitcoin in the coming weeks.
Sources:
- Markets Insider
- CoinGape
- Business Insider