Ethereum ETF has landed, is the altcoin going to start?
The Ethereum ETF has been unveiled, ushering in a new chapter in the crypto circle! This may not only cause the price of Ethereum to soar, but may also have a huge impact on the entire altcoin market and crypto ecology.
Ethereum ETF is a major recognition of cryptocurrency by the mainstream financial market. It is like an investment artifact, allowing investors to catch the express train of the crypto market without having to buy and store coins in person.
After the great success of Bitcoin ETF, Ethereum ETF is even more ready to go. Bitcoin ETF has attracted more than $17 billion, causing the price of Bitcoin to rise sharply. But Bitcoin's solo dance did not drive the entire crypto market, because the big guys didn't invest much in altcoins after making money.
But Ethereum ETF is different. Its capital inflow may set off a series of ripple effects:
1. Ethereum price surge: As soon as funds come in, the price of Ethereum has to rise. It is the big brother of DeFi (decentralized finance). As the price rises, the money in DeFi projects will also be valuable. Large platforms such as Uniswap and Aave have more locked money, and the ecosystem is more stable.
2. The DeFi ecosystem is getting lively: DeFi projects make more money, and their own tokens also rise. The governance tokens of platforms such as Compound and SushiSwap also rise with the rise of ETH.
3. New tokens and mining are hot: DeFi is popular, and new tokens, mining, etc. are also hot. More people buy ETH, and there are more places to use it, so the chain is more active. Automated money-making tools such as Yearn Finance are more popular when ETH rises.
4. More activities on the chain: ETH is used more, burned more, and saved more, so its value is naturally higher. The new rule of EIP-1559 also makes part of the transaction fee disappear directly, making ETH more scarce. When ETH rises, people may also buy altcoins, and the altcoin market is also hot.
The altcoin market may explode now. So many applications and projects on Ethereum rely on ETH for their livelihood. As ETH rises, these projects also benefit. Institutional investors are more interested in Ethereum and altcoins because they have more ways to play and more opportunities.
When retail investors see ETH hit a new high, they may also want to get a piece of the pie. In the past, when the market was hot, retail investors rushed in and the price rose sharply.
