QCP Capital predicts spot Ethereum ETF approvals could drive prices higher

Crypto asset trading firm QCP Capital suggested that if spot Ethereum exchange-traded funds are approved in the U.S., the price of ether could rally 60% in the coming weeks to around $6,000 — if the spot Bitcoin ETFs are anything to go by.

Bitcoin rose 66% from around $44,500 to a peak of $73,800 in the two months following the Security and Exchange Commission’s approval of spot Bitcoin ETFs on January 10, according to The Block’s price page.

The SEC has final deadlines on Thursday and Friday to decide whether to approve or deny the applications for spot Ethereum ETFs submitted by VanEck and Ark Invest, respectively. Invesco, Fidelity, BlackRock, Grayscale, Franklin Templeton, and Bitwise are also among the spot Ethereum ETF applicants submitting last-minute changes to their filings this week.

“All eyes are on the ⁠ETH ETF deadline later today. With Friday implied volatility above 100%, the market is expecting fireworks,” the analysts wrote in the Telegram channel QCP Broadcast this morning. “⁠VanEck’s ETF has been listed by the DTCC. We think an approval is now highly likely with trading expected as early as next week.”

Implied volatility here refers to the market’s forecast of ether’s potential price movement over a specified period derived from the prices of options on the cryptocurrency.

QCP’s view mirrors that of analysts at research and brokerage firm Bernstein, who also hold crypto positions. They stated earlier this week that given the sustained demand inflow seen by the spot Bitcoin ETFs post-approval, they would expect similar price action for ether.

“However, ETH free float and supply looks even more attractive than bitcoin…constrained by sticky investors and utility locking supply in financial smart contracts,” the Bernstein analysts added.

Ether trading metrics spike

Aggregated open interest in ether options and futures also spiked this week alongside a record Ethereum futures ETF trading volume of $48 million on Tuesday.

The Grayscale Ethereum Trust (ETHE) discount to net asset value (NAV) also narrowed to its lowest level in over two years this week, hitting -6.7% after Bloomberg ETF analysts Eric Balchunas and James Seyffart dramatically raised their odds of spot Ethereum ETF approvals from 25% to 75% on Monday amid signs of a 180 from the SEC.

However, a significant price correction for ether could be on the cards instead if the SEC denies the applications amid the new-found optimism.

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