When Spot Ethereum ETFs Go Live ‘Expect A Bloodbath’, Says Expert

Name	Symbol	Market	Market Cap ($)	Algorithm
Ethereum	ETHUSD	Crypto	407,574,333,104	Not Mineable

Name

Symbol

Market

Market Cap ($)

Algorithm

Ethereum

ETHUSD

Crypto

407,574,333,104

Not Mineable

	Price Change	Price Change %	Current Price	Bid Price	Offer
	-2.04	-0.06%	3,392.17	3,392.21	3,392.22

Price Change

Price Change %

Current Price

Bid Price

Offer

-2.04

-0.06%

3,392.17

3,392.21

3,392.22

High Price	Low Price	Open Price	Prev. Close	52 Week Range
3,425.44	3,384.24	3,391.03	3,394.21	1,520.85 - 4,093.88

High Price

Low Price

Open Price

Prev. Close

52 Week Range

3,425.44

3,384.24

3,391.03

3,394.21

1,520.85 - 4,093.88

Exchange	Last Trade	Size	Trade Price	Currency
GDAX	06:15:09	0.002858	3,392.16	USD

Exchange

Last Trade

Size

Trade Price

Currency

GDAX

06:15:09

0.002858

3,392.16

USD

Price x Volume	Volume	Base Symbol	Related Pairs
33,939,601.74	9,980.77	ETH	ETHEUR	ETHGBP	ETHBTC

Price x Volume

Volume

Base Symbol

Related Pairs

33,939,601.74

9,980.77

When Spot Ethereum ETFs Go Live ‘Expect A Bloodbath’, Says Expert

24/05/2024 9:20am

NEWSBTC

Thomas Fahrer, co-founder of Apollo, a firm focused on Bitcoin adoption, has issued a stark warning regarding the potential market dynamics following the approval of spot Ethereum ETFs. As the market anticipates this new development, Fahrer suggests that the transition might not be smooth for Ethereum. “The Grayscale Ethereum Trust launched in 2017 and accumulated most of its $9 billion dollars worth of ETH well before staking existed. These funds will be unlocked now. Expect a bloodbath. It will accelerate the ETH -> BTC Trade. Hold me to account if I’m wrong. But I doubt it,” Fahrer declared via social media platform X. Spot Ethereum ETFs – A “Sell The News” Event? The imminent approval of spot Ethereum ETFs, similar to earlier this year’s launch of spot Bitcoin ETFs, is expected to convert the $9 billion (approximately 2.94 million ETH) locked in Grayscale’s Ethereum Trust (ETHE) into one such ETF. Historical precedent with Bitcoin suggests potential volatility; after the approval of spot Bitcoin ETFs, Bitcoin experienced more than a 20% drop in value within 12 days amid significant sell-offs from similar conversions. Related Reading: Ethereum Soars 5.6% Ahead Of ETF Decision, Analysts Set Bigger Price Target One of the main reasons the spot BTC ETF approval turned out to be a “sell the news” event was Grayscale’s transition from an Ethereum Trust to a spot ETF. Until now, Grayscale’s Bitcoin Trust (GBTC) saw outflows of more than 50% of its BTC holdings. And the ETHE could be reinforced by the fact that ETH staking is a lucrative option to earn an additional yield. Currently, Grayscale holds over $9 billion in locked Ethereum that cannot be sold or traded until the ETF is operational. Should the approval go through, this large amount of Ethereum will suddenly become liquid, potentially leading to substantial market sell-offs if initial demand does not meet the volume of outflows from Grayscale’s new ETF. Related Reading: Ethereum Whales Come Alive: Are They Buying Or Selling? Julio Moreno, head of research at CryptoQuant, highlighted a critical market indicator that could suggest the market has already begun to react. “Seems like the market has already priced the Ethereum spot ETF approval. Grayscale’s ETHE discount to ETH has significantly narrowed in the last few days. The same happened between GBTC and Bitcoin as the Bitcoin Spot ETF approval was nearing,” Moreno noted via X. While the short-term impact might mirror the turbulent times seen during the Bitcoin ETF launch, the long-term implications for Ethereum could be different. Observers note that despite the initial downturns seen in Bitcoin’s valuation post-ETF, the introduction of a spot ETF was eventually beneficial, leading to greater market acceptance and a price surge. “BTC rallied 75% in 63 days after the spot ETF was approved. If ETH follows the same trend (if approved), this would take it to $6,446 by July 23,” crypto analyst Miles Deutscher noted. At press time, ETH traded at $3,676. Featured image created with DALL·E, chart from TradingView.com

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