This post was originally published on cryptonewsfarm.com
Ethereum Outperforms Bitcoin on Spot ETF Hype and Increased Network Activity
Ether (ETH), the world’s second-largest cryptocurrency, started 2024 strong but lost momentum in mid-March. However, a resurgence began in mid-May fueled by excitement surrounding the potential approval of exchange-traded funds (ETFs) specifically for Ether in the United States. While ETH has trailed Bitcoin (BTC) since the year’s beginning, it has significantly outperformed it since the Securities and Exchange Commission (SEC) officially greenlit spot Ether ETFs on May 23rd. Over the past month, ETH has surged roughly 30% compared to Bitcoin’s meager 9% gain.
Several factors are contributing to ETH’s recent dominance over BTC. Firstly, there’s a clear increase in Ethereum’s network activity. This includes a rise in transaction volume on popular decentralized applications (DApps) built on the Ethereum blockchain, along with a growing number of unique smart contracts being deployed. This data suggests a thriving ecosystem and potentially higher demand for ETH.
Secondly, the anticipation surrounding the launch of spot Ether ETFs is adding significant bullish pressure. These ETFs would allow investors to gain exposure to the price of ETH without directly holding the cryptocurrency itself. This could potentially attract a wave of new institutional money into the Ethereum market, further driving up the price. Industry experts like Bloomberg’s senior ETF analyst, Eric Balchunas, believe these products could be launched by late June, based on recent updates from major investment firm BlackRock.
The potential impact of spot Ether ETFs is fueling optimism among market participants. Some believe Wall Street giants might utilize these ETFs as a way to participate in the growth of Web3, a decentralized internet built on blockchain technology. This increased institutional interest could propel ETH to new highs, with some analysts even predicting a price surge towards $10,000 during this current market cycle.
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Author: Sb
