The Chicago Board Options Exchange (CBOE) has definitively confirmed the rumors regarding an imminent launch of spot Ethereum ETFs: start date of trading confirmed for tomorrow.
The entire Ethereum ecosystem is celebrating the public recognition of ether as a regulated resource and open to major investment exchanges.
The experts believe that the launch of spot ETFs could drive greater buying pressure, creating a supply shock on centralized exchanges.
In the meantime ETH has returned above 3,500 dollars after the disappointing price action in the month of June. All the details below.
CBOE: launch date of spot Ethereum ETFs set for July 23
Here we are: the launch date of the Ethereum spot ETFs has finally been confirmed by the Chicago Board Options Exchange (CBOE).
After the rumors advanced on X by the ETF Analyst di Bloomberg, here comes a definitive date for the start of trading of the new cryptographic investment instrument.
The SEC has accepted the revisions of the S-1 documents by five exchange-traded fund issuers, following the approvals of the previous 19b-4 forms.
The first official date for the listing of spot ether ETFs is expected for tomorrow, Wednesday, July 23, 2024. This date officially enters the history of the crypto world.
Curious to point out instead how today Ethereum celebrates 10 years from the launch date of the first ICO in 2014.
As reported by the CBOE on July 19, “pending regulatory effectiveness” tomorrow the negotiations will begin within the Chicago exchange for the following managers: 21Shares, Fidelity, Invesco Galaxy, VanEck, and Franklin Templeton.
All spot ETFs will start trading with fees equal to 0%, except for Invesco Galaxy which will apply a 0.25% fee.
After the initial phase of incentives, which will last more or less 6 months, all listed funds will align in a range of fees that goes from 0.19% to 0.25%.
The temporary revenue waivers and initially planned commission discounts are motivated to attract as many volumes as possible.
I had seen a similar dynamic also with the listing of spot Bitcoin ETFs, where many issuers had also dedicated investment services with entry costs that were practically null.
Reserves at a minimum on exchanges: the launch of spot ETFs could create a supply shock for Ethereum
As the CBOE announces the date for the listing of spot Ethereum ETFs, market analysts begin to speculate on what the impact on the crypto market will be.
Certainly, the data that stands out the most to the eyes of on-chain experts is the trend of ETH reserves within centralized exchanges.
From 2021 to today, while the price of the coin has gone through various roller coasters in the dollar chart, reserves on CEX have steadily decreased.
From an initial sum of 32.5 million ETH held in this type of platforms, the figure is now halved to 16.7 million ETH.
This technical condition, combined with the possible buying pressure that spot ETFs will induce in investors, could cause a supply shock of Ethereum on the exchanges.
This means that in the absence of digital resources to offer to buyers, the price of the currency would skyrocket until a balance is found between supply and demand.
At the moment, the reserves on the exchange are at their multi-year lows.
In addition to all this, we point out that a recent report by Kaiko suggested that the reduction of the liquidity of the ether market could lead to greater short-term volatility. In particular, the current 1% market depth opens the door to unexpected price scenarios, with the crypto potentially surprising even the most bull after the launch of the ETFs.
In support of this thesis, several analysts believe that the inflows of the first exchange-traded funds for Ethereum could attract billions of dollars in trades.
One of these, the institutional analyst Tom Dunleavy even believes that the inflows could cover 10 billion dollars in the first year, with about 1 billion in revenue each month. Here are his words in a recent interview.
“I expect a very positive impact on prices, sending us to new all-time highs at the beginning of the fourth quarter.”
ETH price analysis: rise in quotations above $3,500
While waiting for the long-awaited launch date of the spot Ethereum ETFs, officially confirmed by the CBOE, the cryptocurrency is warming up and starting the bull phase.
After the month of June, which proved disastrous for the price action of the entire market, from July 8 to today ETH has grown by about 20%.
The quotations of the currency have returned between yesterday and today above 3,500 dollars, only to drop by a few basis points to the current 3,495 dollars.
The volumes are not particularly encouraging but with the latest movement ether has managed to fully recover the dump from the early days of July, demonstrating incredible strength.
Now the prices are above the daily EMA 50, ready for a new leg up that would indicatively bring ETH close to 4,000 dollars.
By the end of the year, if the ETFs have the same success as those of Bitcoin, we could even hypothesize the breaking of a new all-time high above 5,000 dollars.
If we compare the pre-listing trades of the Ethereum spot ETF with those recorded between the end of 2023 and the first days of 2024 with Bitcoin, we can notice a similar pattern.
In the 15 days leading up to the approval of Bitcoin ETFs, the top cryptocurrency has indeed grown by about 10%.
On the day of the listing, however, BTC fell by 0.67% after attempting an upward spike, followed the next day by a sad decline of 7.6%.
The selling pressure continued in the following days, printing another 10% contraction. Overall, until the end of the month, the loss was about 20%.
However, after just 3 weeks from the launch, the Bitcoin ETFs have borne fruit, bringing the quotations to new annual highs.
As of today, after about 7 months BTC is at a value 45% higher than pre-ETF prices.
We can expect a similar pattern for the spot Ethereum ETF, with the first days marked by red, and subsequently a strong phase of bright green.
We remind you in any case that the market outlook is now different compared to January, just as the conditions of Ethereum are different compared to Bitcoin.
In this regard, Matt Hougan, Chief Investment Officer of Bitwise, states that the stakers of Ethereum have locked about 28% of the circulating supply of Ether.
Huogan expects a greater price increase of Ethereum after the launch of the ETFs since the holders of the cryptocurrency are not willing to sell shares.
