Investors Advised to Shift Focus from Ether to Bitcoin Following ETF Launch
Crypto analysis firm K33 Research suggests that investors consider shifting their focus from Ether (ETH) to Bitcoin (BTC) following the underwhelming debut of Ether futures-based exchange-traded funds (ETFs) in the US. The launch of these ETFs, including offerings from VanEck, ProShares, and Bitwise, did not generate the same level of attention and trading activity as Bitcoin futures ETFs did in 2021.
K33 Research analysts Vetle Lunde and Anders Helseth reported that the Ether ETFs experienced unexpectedly weak performance, accumulating just $8.5 million in assets under management on their launch day. In contrast, Bitcoin ETFs amassed a substantial $576.5 million in AUM at their debut.
Ether Optimism Fades as Decline Continues
The analysts pointed out that the anticipation surrounding the Ether ETFs led to increased Ether futures premiums initially, but this optimism quickly faded due to lackluster results. The ETFs also failed to reverse the ongoing trend of Ether’s declining value relative to Bitcoin, which has persisted for over a year.
Comparing this scenario to the launch of regulated Bitcoin futures contracts in 2017, the analysts noted that institutional investors took years to embrace the Bitcoin futures market. However, Bitcoin futures ETFs saw rapid adoption in 2021. This suggests that it may be time to reallocate from Ether to Bitcoin.
According to K33 Research, traders are now divided in their outlook for the crypto market. Futures market data points to bearish sentiment, while options data reveal a preference for bullish call options.
Hot Take: Shifting Focus from Ether to Bitcoin
The lackluster performance of Ether futures-based ETFs and the ongoing decline of Ether relative to Bitcoin suggest that it may be wise for investors to shift their focus from Ether to Bitcoin. With underwhelming launch results and a lack of reversal in the declining value trend, the analysts at K33 Research advise reallocating investments towards Bitcoin. Traders are currently divided in their outlook for the crypto market, with futures market data indicating bearish sentiment and options data showing a preference for bullish call options. This shift in focus highlights the dynamic nature of the cryptocurrency market and the need for investors to adapt their strategies accordingly.
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