Ethereum will exceed $6,500 this year: Steno Research

With the decline of bitcoin (BTC), Ethereum’s cryptocurrency ether (ETH) undid some of the price momentum it had gained a month ago with the approval of its exchange-traded funds (ETF) in the United States. However, there are factors that indicate that this could be reversed.

According to research firm Steno Research, The cryptocurrency market is being too pessimistic about the imminent launch of Ethereum ETFs. He believes that such instruments could attract great demand on Wall Street, which translates into upward pressure on the price of ETH.

“We continue to forecast net inflows of between $15 billion and $20 billion in the first 12 months,” said firm analyst Mads Eberhardt. With such a level of estimated demand in Ethereum ETFs, The firm predicts that the price of ETH will rise to at least USD 6,500 by the end of 2024.

At the moment, bitcoin ETFs launched in the United States have accumulated almost USD 15 billion since their launch 6 months ago. This is despite having recently experienced exits, which appear to be a safeguard from the decline that usually occurs in the markets during the local summer, which runs from June to September.

Because these ETFs invest directly in bitcoin, which is why they are called “spot” or “cash”, their demand drives the price of the currency. As a result, the flow that these instruments have captured has caused the price of BTC to reach a new historical record of USD 73,700 in March.

Since then, the price of bitcoin has remained sideways in a range below, reflecting an attempt by the market to consolidate the rise. Instead, Ether has yet to surpass its 2021 record of $4,900.

ETH could see more bullish pressure than BTC due to ETF demand

“A smaller inflow into ether ETFs compared to bitcoin ETFs will have a larger impact on ether due to its smaller market capitalization and substantially poorer liquidity,” the Steno Research analyst emphasized. Thus, It is likely that its demand will surprise with upward price reactions.

According to broker Bernstein, ETH ETFs will get the same sources of demand as BTC ETFs, but on a smaller scale. According to him, the reason is that, in order to be approved, these instruments had to eliminate their exposure to staking, an activity that gives rewards for keeping cryptocurrencies deposited in the corresponding smart contract.

In tune, entities reported by CriptoNoticias such as the Grayscale fund issuer Ethereum ETFs projected to capture 25-30% of bitcoin capital inflows.