Speculators flock to ETH as bulls target $3,700
Eye on Ethereum spot ETF: Will it succeed?
Like top altcoins like Bitcoin and Solana, Ethereum has also remained stable. It is currently trading above the local support of $3,300 and is on the way to further gains with a target of $3,700.
The rally was driven by multiple market-related factors, mainly the expectation of a spot Ethereum ETF to be launched in the coming days. Looking at the daily chart, the news of the accelerated approval of Form 19b-4 by the U.S. Securities and Exchange Commission (SEC) triggered a wave of demand since May 20.
However, even as prices remain stable and trend upward, speculators have infiltrated the market. The expected leverage ratio has risen over the past few trading days. The ETH market has attracted more leveraged traders who are more keen to profit from price fluctuations rather than benefiting from the benefits that ETH brings as a digital asset. The estimated leverage ratio was 0.347 on July 16 and then rose to 0.354 on July 17. The expansion suggests that traders are increasingly borrowing funds on perpetual trading platforms such as Binance and OKX, hoping to make a killing when ETH bulls push the price above $3,700.
The SEC has approved three issuers to list. However, it is expected that all spot Ethereum ETF applicants with approved Form 19b-4 will be approved to list at the same time.
There is confidence that spot Ethereum ETFs will emulate the success of spot Bitcoin ETFs. As of July 18, the total BTC managed by all spot Bitcoin ETF issuers exceeded $53 billion.
Even so, despite the high anticipation of the product and its potential positive impact on price, its demand level is different compared to when spot Bitcoin ETFs were launched. Ethereum's lower market capitalization and the SEC's decision not to allow spot ETF issuers to collateralize ETH. By staking, the issuer will receive rewards on behalf of its customers.
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