Crypto asset (virtual currency) trading company QCP Capital released a market report on the 17th.
In this report, the company predicts that Ethereum (ETH) will outperform Bitcoin (BTC) over the medium term. They believe that speculation that a physical Ethereum ETF (exchange traded fund) will be approved in the United States following Bitcoin will be a factor supporting the price.
According to TradingView data, the price of “ETH/BTC” fell to the 0.04 BTC level last week, and then rose to over 0.06 BTC on the 13th. At the time of writing this article, the price is on a downward trend, but QCP Capital mentions the price movement at this time.
He also introduced the benefits of investing by pointing out that since Bitcoin spot ETFs were approved in the United States, Bitcoin futures prices have fallen more than Ethereum futures prices. He also expressed the view that there is a possibility that an Ethereum spot ETF will be approved after May.
He also pointed out that the virtual currency market may be affected by macroeconomic conditions from the Bitcoin halving scheduled for April this year until May. The company did not specifically explain the “medium-term” period in which Ethereum would surpass Bitcoin.
connection: “Ethereum is expected to outperform Bitcoin’s growth rate” JP Morgan forecast for next year
What is an ETF?
Abbreviation for “Exchange Traded Fund.” Refers to investment trusts listed on financial instruments exchanges, where a wide range of financial products, not just virtual currencies, are traded.
Spot ETFs are attracting a lot of attention from investors because they actually own and manage virtual currencies.
▶️Virtual currency glossary
Is ETH spot ETF also approved?
The U.S. Securities and Exchange Commission (SEC), which had previously disapproved all Bitcoin spot ETFs for reasons such as investor protection, approved them for the first time last week, sparking interest in the next Bitcoin spot ETF.
Investor interest further increased after Larry Fink, CEO of BlackRock, the largest U.S. asset management company, said, “We see value in Ethereum spot ETFs.” BlackRock has received approval for a Bitcoin spot ETF and has also applied for an Ethereum spot ETF.
connection:BlackRock CEO talks about Ethereum spot ETF and Bitcoin
The reason why “May” is the standard for approval of Ethereum spot ETFs is because some ETFs have a final deadline in May for the SEC to decide whether to approve or reject them. The timing of the approval of the Bitcoin Spot ETF was similarly predicted, and it was actually approved as predicted.
On the other hand, as mentioned by Mr. Fink, there is a view that Ethereum will be associated with security issues.
Analysts at financial giant JP Morgan said, “In order for an Ethereum spot ETF to be approved, Ethereum must be classified as a commodity (similar to Bitcoin) rather than a security.However, the SEC will classify Ethereum as a commodity by May. There’s probably less than a 50% chance that it will be classified as such.”
connection: Ethereum spot ETF approval possibility by May, JP Morgan analysis: “50% or less”
US investment bank TD Cowen also believes the SEC is unlikely to approve an Ethereum spot ETF any time soon. First, he indicated that he would like to closely examine the situation after the Bitcoin ETF was approved and wait to see how it goes. He says a decision will probably be made after the presidential election in November.
connection: U.S. investment bank TD Cowen “Ethereum ETF will not be approved immediately”