Will Ethereum break through $5,000 in June? Future trend forecast of institutional demand and market expectations

Original title: Ethereum to $5,000? Nine experts on how the ETF approval will impact prices

Original author: Eric Johansson, DL News

Original translation: Ismay, BlockBeats

 

Editor's note: With the approval of the US spot Ethereum ETF, the market's enthusiasm for Ethereum is high. Industry experts have predicted that the price of Ethereum will usher in a new round of increases. Institutional analysts such as Galaxy, FRNT Financial, CCData, OKX, and Consensys have expressed their views that the demand of institutional investors will drive the price of Ethereum up. However, they also warned of potential market challenges and volatility. This article brings together views from all sides to take you to explore the future prospects of this important market trend.

 

Ethereum surged more than 30% to $3,800 in May following the U.S. ETF approval, and market watchers now expect it to hit new highs of more than $5,000 in early June. As the dust settles, markets are speculating on where Ethereum might go next.

 

Here’s what the experts are saying.

 

Galaxy

 

Galaxy CEO Mike Novogratz said a “broad” shift in Washington led the SEC to change its tune on an Ethereum ETF.

 

If the SEC’s shift in tone was politically motivated, “that would be a significant change,” and “if that were true, the price would be a lot higher than it is now.”

 

However, since his comments, President Joe Biden has made good on his threat to veto a pro-crypto bill that has bipartisan support.

 

FRNT Financial

 

David Brickell, head of international distribution at FRNT Financial, said Bitcoin and Ethereum will hit new all-time highs by the end of June.

 

He said the approval of a spot Ethereum ETF, a more positive economic outlook and a series of crypto-friendly votes on Capitol Hill indicate that the two world-leading cryptocurrencies will enjoy strong tailwinds in the coming weeks.

 

“I wouldn’t be surprised to see Bitcoin hit $80,000 and Ethereum hit $5,000.”

 

CCData

 

Jacob Joseph, a research analyst at CCData cryptocurrency data firm, not only expects Ethereum to hit a new record, but also believes that investors will pour $3.9 billion into a U.S. spot Ethereum ETF in the first 100 days of its launch. He extrapolated that number from the performance of 10 spot Bitcoin ETFs in their first 100 days.

 

Even so, he warned that Ethereum could face challenges from outflows from the Grayscale Ethereum Trust, which could weigh on sentiment.

 

Grayscale’s Bitcoin Trust has seen more than $17.7 billion in outflows since its launch in January, according to BitMEX Research. Those funds have primarily gone to funds with lower fees.

 

OKX

 

OKX's global chief commercial officer Lennix Lai said the spot Ethereum ETF will trigger a new wave of demand from institutional investors.

 

They could put $500 million into Ethereum ETFs in the first week, he said. "This could be as important as the approval of the Bitcoin ETF, or even more important."

 

TzTok-Chad

 

Growing optimism in the industry has prompted traders to invest about $3.4 billion in call options, betting that Ethereum will exceed $4,000 by June 28.

 

TzTok-Chad, the anonymous founder of decentralized options exchange Stryke, said positioning in the derivatives market shows that many traders are even targeting prices above $5,000.

 

However, he warned that the road to a new record would not be smooth and some volatility is expected.

 

Consensys

 

Joe Lubin, founder of Consensys and co-founder of Ethereum, said he expects a "flooding" growth in demand for Ethereum, which could lead to supply constraints and drive prices higher.

 

Lubin said institutions that have already dabbled in bitcoin ETFs "will likely want to diversify into the second approved ETF."

 

“The natural and pent-up demand to buy Ethereum via an ETF will be very large, but the supply to meet that demand will be less than when a spot Bitcoin ETF was approved in January,” he said.

 

Bernstein

 

Don’t expect Ethereum ETFs to see inflows at the same level as Bitcoin funds, said Gautam Chhugani and Mahika Sapra, analysts at research firm Bernstein.

 

ETFs represent an opportunity to tap into “pent-up demand from the same players as the Bitcoin ETF, perhaps with a lower allocation to Ethereum,” they said in a June 3 note.

 

“Given Ethereum’s supply profile (staking, smart contracts, holdings data), Ethereum should see positive price performance when the ETF launches (expected sometime in the next few days/month),” Chhugani and Sapra said.

 

Kaiko

 

Adam McCarthy, an analyst at Kaiko, said traders around call options are now seeing gains.

 

Even so, he warned, “ETFs in Hong Kong are not seeing much demand and have experienced several days of net outflows. The lack of collateral is also a big factor that could further impact demand.”

 

He suggested keeping an eye on Grayscale’s $9 billion ETHE product, “If there are large outflows, this will have a significant impact on the price.”