๐๐ฅ BIGGER CRASH AHEAD?? - $ETH ETF SELL-OFFs ๐ฅ๐
The much-anticipated launch of spot Ether ETFs has led to an unexpected sell-off, revealing significant market shifts. The long-awaited introduction of these ETFs initially brought a wave of optimism, but it quickly resulted in a sharp decline in the price of Ether.
๐ According to the latest 10x Research report, this sell-off mirrors previous patterns seen with crypto ETF launches, including spot Bitcoin ETFs. Markus Thielen, founder of 10x Research, noted that traders expected #Ethereum ETFs to capture 20% of Bitcoin ETF inflows. However, they underestimated potential billion-dollar outflows from Grayscale and the typical 'sell the news' reactions. Additionally, the crypto market is entering a seasonally weak period.
๐ The approval and launch of spot Ether ETFs coincided with the first BTC distributions from Mt. Gox, exacerbating the selling pressure in the market. The 10x report highlights that Grayscaleโs $9 billion Ethereum Trust saw significant outflows, losing $481 million on day one and $326 million on day two. Conversely, other ETF issuers like Bitwise recorded $204 million in inflows, primarily from Pantera Capital. This mixed sentiment indicates a lack of confidence in sustained growth, as Pantera quickly sold off its "seed investment."
๐ The report suggests a bearish outlook on Ether, stating that it was overbought before the ETF launch. "Ethereum might be the weakest link, where fundamentals like new users and revenues have been stagnant or lower," the report says. Despite Bitcoin's status as "digital gold," Wall Street traders struggle to define Ethereum's unique value proposition.
โ ๏ธ The report also points out a shift from ETH to Solana, with #memecoin issuances flocking to the Solana blockchain. Investors should be cautious, as further declines could be on the horizon due to the potential overhang from Mt. Gox, the upcoming US earnings season, and weak season trends for August n September.
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