Coinbase Report: Ether May Soon Surprise the Market with Upside
On May 15, Coinbase Institutional released a research report that may have Ethereum (ETH) investors feeling optimistic about the future. Despite Ether underperforming compared to Bitcoin (BTC) and the broader crypto market this year, the report suggests that ETH could see a surprising increase in the coming months.
The report highlights Ether’s strong long-term potential, pointing out the absence of significant supply side pressures that often affect other cryptocurrencies. Analyst David Han emphasized the growing impact of staking and Layer-2 (L2) solutions on ETH liquidity, further strengthening its market position.
ETH’s central role in DeFi is expected to remain secure, thanks to the broad adoption of the Ethereum Virtual Machine (EVM) and innovations in L2. The EVM enables developers to create smart contracts and supports the widespread adoption of DeFi applications, while L2 solutions built on Ethereum enhance scalability and reduce data bottlenecks.
One key point discussed in the report is the potential impact of US approval of spot Ether exchange-traded funds (ETFs). The report suggests that the market may be underestimating the timing and odds of potential approval, leaving room for surprises to the upside. The deadline for the first potential approval of a spot Ether ETF is May 23, 2024, with Coinbase expressing optimism that litigation could eventually lead to approval.
Overall, the report underscores the importance of Ethereum’s unique attributes and the significant role of potential ETF approvals in shaping its future market trajectory. With the crypto market constantly evolving, investors will be keeping a close eye on Ether and its potential for growth in the coming months.
