No longer is intriguing when Crypto Whales meet with Wall Street

2024 年 5 月 22 日 | English Blog

In the past few days, news has continued to spread about the pending spot Ethereum ETFs, making the price of ETH rise about 20%.  My idea is, whether this ETF  comes true, large investors have enjoyed sheer profits from selling ETH at current prices. Their goal has been achieved and the success of spot ETF is of secondary importance. 

The increase in ETH price has been so impressive, and we can learn from its spot Bitcoin equivalent. As soon as the Bitcoin spot ETF debuted, its upward cycle was over. Therefore, regardless of whether Ethereum can succeed or not, its price is already at a high level. It is high time not to buy, or you didn’t buy it! 

In fact, I have always believed that when a spot ETF for a certain cryptocurrency is listed, it loses the most attractive investment characteristic of cryptocurrency: high volatility of price. 

The situation is like a wild beast that is suddenly taken into domestic use and it can no longer be ferocious.

In the past, we were interested in investing in Bitcoin because it is decentralised enough, not regulated by the government, and does not need to be endorsed by relevant authorities around the world. This is why this asset has its unique characteristics, which is very different from traditional assets. And one of them is: the difference between “big players”. Before there were spot ETFs, the big players had mainly come from active builders in the decentralized ecology, the so-called “giant whales”, such as Microstrategy and Binance, etc.; after there are ETFs, the big players include traditional financial institutions, 

In particular the participation of Wall Street players. They regard Bitcoin as a commodity, turning their investment attitude more rigid and conservative. They lack the “mania” as giant whales have, especially in terms of contributions to the decentralised ecology.  This renders  the price of Bitcoin much more “stable” than before. 

Now Bitcoin is becoming an asset that traditional financial institutions can play with, The price volatility has obviously narrowed a lot, to about 20%. This is a fundamental change compared to the characteristic of cryptocurrency prices that can easily multiply.

From the above, whether you think Ethereum will be approved for spot ETF or not by SEC, the best time to buy Ethereum has passed. I think its price has reached the peak, and following this trend the Bitcoin price has also been driven up but I believe there is not much room for another surge. 

On the contrary, we must be cautious about a sharp decline in all crypto assets after the current rise.