Today we are going to cover the recent launch of the Ethereum (ETH) exchange-traded fund (ETF) and the effect it has had on the market.

I’ll compare this Ethereum ETF launch to two very similar events to give you some additional perspective.

We’ll also look at what to expect in the short, medium, and long term and how to play this market.

As always, you can watch my full analysis in the video below or read the summary article.

Bitcoin’s Recent Performance

First, let’s look at Bitcoin (BTC) and its performance over the past few days. Our correction, which began in the middle of March, bottomed out on July 5. I called a bottom to the correction and am standing by that call.

Since July 5, Bitcoin has climbed from a low of $54,000 to a high of $68,000 just last week. However, it has since fallen to just under $65,000.

Bitcoin appears to have found support between $64,000 and $65,000. While these levels aren’t crucial, the main point is that we are trading above the July 5 low.

After July 5, I wrote that we would see more choppy trading for the next few weeks — maybe months — before breaking above $70,000 and moving to new all-time highs.

Although some people might be upset about the recent price dip, this choppy trading is to be expected. We can see Bitcoin retesting the $61,000 or $60,000 support levels in the coming days.

However, overall, we are preparing for more up-and-down movement as we head into the fall. There’s nothing to worry about.

Ethereum’s Performance and the ETF Launch

This week’s Ethereum chart looks worse than Bitcoin’s.

Interestingly, for the past few months, Ethereum had been looking better.

However, Ethereum has lost much of the momentum it built since the July 5 low. It climbed from $2,800 to just under $3,600.

But when the Ethereum ETF launched on Tuesday, the price began to trickle down to around $3,100.

The main reason for this drop is large holders of Ethereum — specifically, the Grayscale Ethereum Trust (NYSE: ETHE) — looking to exit their positions. The spot Ethereum ETF launch provided a great opportunity for them to unload their holdings.

We saw a similar scenario with the spot Bitcoin ETF launch earlier this year. The price of Bitcoin dropped in the first few days after the launch, but we know that Bitcoin’s price has since risen significantly.

Historical Context and Future Expectations

To put things in perspective, let’s look at two historical examples: the spot Bitcoin ETF launch and the first gold ETF launch in 2004.

When the spot Bitcoin ETF launched in January, Bitcoin’s price headed lower in the first few days. However, Bitcoin’s price has climbed significantly since then.

Similarly, the spot price of gold was $444 per ounce on the day of the first gold ETF launch. Twenty-four hours, 24 days, and even 24 weeks later, the price of gold was lower than on the day of the launch.

However, two years after the launch, the price of gold was $624 per ounce. Today, the price of gold is far higher, having recently reached nearly $2,500 per ounce.

The ETF launch had a major impact on the gold market, driving prices up by 346% over roughly eight years. Similarly, the Bitcoin ETF launch significantly impacted both the Bitcoin and the overall crypto markets. We need to give the markets time to let these changes play out.

Institutional Demand and Market Patience

Regarding the Ethereum ETF, we are now 48 to 72 hours post-launch. There will be an initial sell-off from people holding Ethereum or the Grayscale Ethereum Trust. The market needs time to absorb these losses and factor in new demand.

Rumors suggest significant institutional demand for Ethereum, possibly even outweighing retail demand — which is rare in the crypto market.

Institutions typically make moves slowly, planning strategies months ahead and taking time to deploy capital. We need to be patient and allow the institutions time to act.

Final Thoughts

To sum it up, the Ethereum ETF launch is a significant development with long-term implications. Historical examples show that ETF launches can initially drive prices down but lead to significant gains over time.

Patience is key.

The demand that will come through this Ethereum ETF will likely have a significant impact on the crypto market. We need to give it time to see the full effects.

Good things come to those who wait.

Editor’s Note: Cryptocurrency has been the best returning asset class of the last decade and is know for its parabolic bull markets. However, those days won’t last forever. This may be your last chance to get in on the action before what could be the last great Bitcoin bull run. Every day you wait is literally costing you thousands in profits.

If you’re worried you can’t figure out crypto… don’t be. Our in-house crypto expert, Alex Benfield, will walk you through everything you need to know about crypto, step by step.

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