Ether holders are feeling the pressure as the cryptocurrency dipped below $2,900 last week, causing concern among investors. The price of Ether has been fluctuating around $3,000 in the following days, leading many to believe that the bull market may have come to an end.
Despite news of an imminent approval for spot Ether ETFs in the US, interest in the asset is noticeably declining market-wide. Traders are worried that the price of Ether will continue to drop even after the ETF launch, which is expected to happen soon with many anticipating approval from the SEC this month.
The decline in Ether’s value is not isolated to just the second-largest crypto asset, as the entire industry took a hit. The crypto market cap fell below $2 trillion last week before rising again, causing concern among traders. This drop was attributed to bitcoin’s value dipping to new lows due to incidents involving Mt. Gox and the German government.
Mt. Gox’s repayment process began this month, with creditors expected to receive 140,000 bitcoin. The influx of bitcoin into the market was expected to impact its price, which had been rising before the downturn in June. Additionally, the German government selling bitcoin in the millions of dollars has added selling pressure, contributing to bitcoin’s price drop.
As the largest cryptocurrency drops in value, the rest of the market follows suit, as seen with Ether. With more bitcoin expected to enter the market in the coming weeks and months, industry participants are worried about the market’s downtrends.
Ether traders have become less optimistic, as evidenced by their behavior in the derivatives market. While the premium on Ether futures contracts typically fluctuates between 5% to 10% during bull markets, it recently dropped from an impressive 11% to 8%. This decline reflects the waning interest among Ether traders.
Despite the current challenges, there is anticipation about how Ether will perform with spot ETFs hitting the market. Investors are closely watching the developments in the cryptocurrency market as they navigate the uncertain waters ahead.
