Ethereum has soared in the past 48 hours, driven by favorable regulatory developments, which boost the chances of an Ethereum exchange-traded fund (ETF) being approved soon.

However, the chances of a major "buy on the rumor, sell on the news" reaction for Ethereum appear lower compared to Bitcoin, according to a recent Citi report.

Bitcoin is down 17% after ETF approval due to boom and leveraged bets. In contrast, the possible approval of an ETH ETF has been less expected, leading to less extreme prior positioning, according to the report.

Following the release of these reports, Ethereum futures open interest and funding rates have been subdued compared to previous months. However, open interest has begun to increase, indicating increased anticipation of a possible approval of Ethereum.

Net flows into Bitcoin ETFs have been one of the main drivers of returns since their launch in January, explaining much of the cryptocurrency's performance. This trend is likely to continue with the introduction of Ethereum ETFs, indicating that overall cryptocurrency ETF flows will continue to be important to returns.

Reports indicate that intense talks are taking place behind the scenes between regulators and ETF providers, including nine fund providers with pending applications in various phases. Previous Bitcoin ETF approvals suggest that simultaneous Ethereum ETF launches are likely.

Historical data from Citi shows that net flows of spot Bitcoin ETFs actually influence the performance of the cryptocurrency. For example, net inflows into BTC ETFs totaled $12.9 billion through May 20, translating into a rally.#MemeWatch2024#Bitcoin #ETH