The recent underperformance of the Ethereum (ETH) in relation to the launch of the first ETH futures ETFs has raised concerns among researchers and analysts. K33 Research, in particular, has reevaluated its recommendations regarding the Ethereum cryptocurrency.
In a recent report, analysts Anders Helseth and Vetle Lunde from K33 Research expressed their concerns about Ethereum’s performance and the lack of compelling medium-term narratives. They noted that the launch of Ethereum futures ETFs has attracted less capital than expected, with trading volumes representing only a fraction of what was seen with Bitcoin (BTC) futures ETFs in 2021.
To illustrate, ProShares’ Bitcoin futures ETF traded over $1 billion on its first day, while ProShares’ Ether Strategy Fund (EETH) only reached $882,000 during the same period. According to the analysts, this indicates a lack of significant institutional appetite for Ethereum at the moment and a general disinterest in cryptocurrencies beyond Bitcoin.
The researchers emphasized that the focus and attraction in the cryptocurrency market continues to revolve around Bitcoin, with promising events in the future supporting aggressive accumulation of the digital currency. While some believe that the approval of Ethereum futures ETFs is crucial for the cryptocurrency’s long-term price, K33 Research pointed out that it would only have an impact if there is substantial liquidity waiting on the other side. Currently, the low institutional appetite suggests that this is not the case for Ethereum.
It is worth noting that these are specific opinions from K33 Research, and there are opposing views in the market, including those from major companies like Grayscale and J.P. Morgan, which have a more favorable outlook on Ethereum’s future. These companies argue that the expanding use cases of Ethereum, including cross-border transactions and the tokenization of real-world assets, justify a more optimistic stance towards the cryptocurrency.