The post Spot Ether ETFs Set to Launch, Expected to Increase Volatility  appeared first on Coinpedia Fintech News

Spot ether exchange-traded funds are expected to start trading in the US this year, leading investors to brace for increased volatility in the price of ether compared to bitcoin. 

Ether Volatility on the Rise 

Since April, the 30-day implied volatility index for ether (ETH DVOL) has increased compared to bitcoin (BTC DVOL). This spread, now at 17%, suggests that investors expect larger price swings for ether.

Ether Price Movements

As of June 19. Ethereum is priced at $3,525.26. Over the last 30 days, it has increased by 15.5%, with a 7-day change of +0.8% and a 24-hour change of +3.2%. At the start of the year, Ethereum was around $2,350. It crossed $4,000 on 11th March but weakened afterward. However, it regained strength in late May, crossing $3,880 on 27th May. Recently, its price has been oscillating between $3,700 and $3,450. 

Lessons from Bitcoin ETFs

Bitcoin ETFs, launched in January, have attracted nearly $15 billion from investors, initially causing BTC’s price to surge. This rally has since slowed down, with experts noting that most ETF inflows are from arbitrage strategies, not outright bullish bets. This cautious approach may also apply to ether ETFs.

Market Expectations and Acceptance 

Ether’s term structure shows higher expected volatility across all time frames compared to bitcoin. Despite this, open interest in ether futures on the Chicago Mercantile Exchange is much lower than in bitcoin futures – $1.6 billion versus almost $10 billion. This indicates that ether has not yet achieved the same level of institutional acceptance as bitcoin. JPMorgan estimates that ether ETFs might only attract $3 billion in net inflows this year.

The launch of spot ether ETHs is expected to increase market volatility for ether. While there is significant excitement, the actual investor response remains to be seen. 

Also Read: Crypto Analyst Predicts Ethereum Dominance to Surpass 20% by Year-End

Stay tuned to Coinpedia for more updates on ether ETFs and market trends!