The longawaited Ethereum spot ETF is about to be launched Should we be bullish or bearish

The sudden downturn seems to be pervasive
The U.S. Bitcoin spot ETF saw outflows of over $1.2 billion in two weeks;
Stablecoin assets are no longer growing;
Continued capital pressure on miners after the halving led to selling;
The 140,000 BTC from the Meituangu event began to be compensated, putting pressure on the market;
AI concepts and meme coins are in a phase of correction after a round of speculation;
Altcoins continue to be unlocked for bloodsucking;
Large new coins are also continuously being launched for bloodsucking.


The total market value of Bitcoin and Ethereum has dropped by 3.5% since the beginning of the month, while Altcoins have dropped by 15%.
According to the regularity of the previous two Bitcoin halvings, there is a 12-18 month interval between the halving time and the peak of the bull market. The rise is not immediate, but accompanied by fluctuations and periodic declines. This halving occurred on April 20, 2024, and the market is expected to begin to turn around by the end of 2024.


Although net inflows this year are stronger than last year, they are still significantly lower than during the 2021/2022 bull market period, and the inflow of funds is not enough to support the arrival of a bull market. So far, net inflows to the cryptocurrency market this year have reached $12 billion. Of this, the net inflow into Bitcoin spot ETFs was $16 billion. Since January, exchanges’ Bitcoin reserves have decreased by about 220,000 coins ($13 billion), indicating that most of the funds flowing into spot ETFs are actually transferred from existing digital wallets, rather than new funds.
Macro monetary environment
After the CPI was announced to be lower than expected on the evening of June 12, the cryptocurrency market rose for a few hours. At 2:00 a.m. on June 13, during the FOMC meeting, the Federal Reserve unexpectedly indicated in the dot plot that it would only cut interest rates once this year, down from 3 times in March. Subsequently, the cryptocurrency market began to weaken.
The largest outflow of funds since March 22 amounted to a total of $600 million (by 6/15), with Bitcoin outflows reaching $621 million, and ETH, LIDO, and XRP funds showing a small inflow. According to Sosovalue data, from June 13 to the present, BTC spot ETFs have been in a state of daily outflows.
The market is bleak, but there is no shortage of news about Ethereum.
First, Consenys announced that the SEC has stopped investigating Ethereum securities issues. Then, market news said that the Ethereum spot ETF is expected to be approved and launched on July 2, and Standard Chartered Bank has also joined in, having been rumored to be building a trading platform for Bitcoin and Ethereum.
Despite the many news, the market has not seen improvement. With Bitcoin falling below $60,000 and Ethereum dropping back below $3,400, the expected spot ETF has provided strong price support for ETH compared to the drop to $2,900 at the end of May and the recent decline of mainstream currencies.
The trend of Ethereum this year can be described as turbulent, but in terms of the main narrative, it is nothing more than the Constantinople upgrade and the speculative market for spot ETFs.
On March 13, the Constantinople upgrade was completed, and ETH rose to a high of $3,981. Later, it turned with the news of the ETF, fell all the way down when the ETF was deemed hopeless, and then rose overnight to $3,600, followed by continued high-level oscillations in line with the broader market.


After the “618” sale, the cryptocurrency market entered another period of calm, with prices being easily influenced by emotions due to a lack of liquidity. Under the panic of ETF fund outflows and the pressure of the Meituangu event, mainstream value coins continued to slide. However, compared to Bitcoin’s drop of 7.72% from $65,000, Ethereum’s resilience was stronger (-3.18%), showing relatively strong support.
On the market itself, there have been many positive news about Ethereum recently.
One is the clarification of its non-securities attribute.
This means that the SEC will not be able to make charges that ETH sales are securities transactions, which corresponds to the passing of the Ethereum ETF 19b-4, which implies the removal of Ethereum’s securities attribute.
The second positive news is the approaching date of the ETF.
On June 21, Bloomberg ETF analyst Eric Balchunas announced on social media that the issuer of the Ethereum spot ETF is expected to submit a revised S-1 form later this afternoon. After that, the SEC will notify the issuer of the final modifications and effectiveness, and the spot ETF is expected to launch on July 2. Considering its previous accurate prediction of the listing of the Bitcoin ETF and the reversal of the Ethereum ETF, this time frame has a certain degree of credibility.
At the current juncture, the much-anticipated Ethereum spot ETF is about to be launched, and its performance after listing has become the focus of industry discussion. The market has completely different views on whether it will sell the fact quickly or turn the tide with the capital of institutions.
Taiwan’s YouTuber Sheng Jieshi, who has surpassed 1 million subscribers, recently tweeted an analysis, stating that ETH may be about to surge.
Sheng Jieshi first explained that based on the weekly trend chart of ETH, from December 2016 when ETH was still close to $6, to now, the lower red line below the uptrend line has been supported. In October 2023, ETH fell below the red line for about 7 weeks, but then rebounded:
So this line has been holding between 2016 and 2024. I still believe that it is an effective support trend line.
And now we are at the bottom of the support trend line that Ethereum has been holding for years, still far from the upper trend pressure line, which means there is a huge potential for an uptrend.


Sheng Jieshi then pointed out that from the weekly momentum indicator (MOM) of Ethereum, all three MOM indicators are bullish, which is also a pattern that may signal an imminent surge. According to the backtesting of cryptocurrency trader Justin, this judgment method is simple and clear, and can indeed capture very large swings.


Lastly, Sheng Jieshi listed a third bullish reason, stating that the weekly Exponential Moving Average Convergence Divergence (MACD) indicator of ETH is showing a golden cross above the zero axis, indicating a bullish trend. He said that MACD is considered a measure of being “rekt” by many people, because after a golden cross, there is usually a significant rise. At this time, entering the market can easily result in being buried:
But I think many people may not really understand how MACD is used… In short, based on Ethereum’s historical data, the probability of a significant rise after a golden cross above the zero axis is over 60%. (Throughout history, there have been two failures and three successful surges. But even if there is no surge, there will still be a rise a month later).


Therefore, according to Sheng Jieshi, based on the above data, the probability of a rise is higher than the probability of a fall if you can build a position at the bottom of the red slope line. He emphasized that you should never go against math, and perhaps building a position at the bottom of the red slope line would be a good choice.
However, compared to Sheng Jieshi’s optimism, Andrew Kang, co-founder of Mechanism Capital, recently
pessimistic
about the future of ETH. He believes that the key to determining how much upside potential the Ethereum spot ETF can provide for ETH lies in whether Ethereum can develop innovative economic improvement paths.
Andrew Kang said that if Ethereum can achieve significant breakthroughs in technology and applications, its upside potential will be more substantial. Conversely, if it cannot find effective economic improvement methods, its upside potential will be limited. He predicted that the ability to attract funds after the launch of the Ethereum spot ETF would be limited, and after the ETF launch, the price of ETH is predicted to be between $2,400 and $3,000.
Returning to Ethereum itself, as the largest application platform in the cryptocurrency field, the price of ETH actually reflects the development of the entire cryptocurrency ecosystem. However, in recent years, as applications and ecosystem development have reached a bottleneck, the Ethereum speculation cycle has begun to focus on upgrades. In addition to the vitality brought about by staking, it exists as a symbol of mainstream coins.
Compared to the value consensus of Bitcoin, the positioning of Ethereum in the eyes of institutions is rather ambiguous. On the one hand, it is a blue-chip stock in the technology sector, an absolute leader in the blockchain world, but on the other hand, it is also an existence that is more easily replaceable in investment products, with a less robust value than Bitcoin, and sometimes does not rise with the market. Especially in the context of limited application innovation, the growth of Ethereum’s ecosystem has slowed down, and MEME cycles have also rotated, occasionally hearing claims of Solana surpassing Ethereum.
Although there is much controversy over the investment value of Ethereum compared to Bitcoin, no one can deny Ethereum’s status and network effect. This is also why the market pays close attention to the Ethereum ETF, as funds from Ethereum may be transmitted to the altcoin market through staking, but funds from Bitcoin will not.
Looking at various price points, it is highly probable that Ethereum will experience high volatility after the ETF, and focusing on selling the fact, short-term bearishness, and long-term bullishness is in line with market price expectations. Before the launch, the speculation of various coins in the ecosystem has already begun, and perhaps this is another alternative way to profit.


This bull market has been hot in the cryptocurrency market
AI combined with Crypto
Nvidia estimates that there are over 40,000 companies worldwide using GPUs for AI and accelerated computing, with a developer community of over 4 million. Looking ahead, the global AI market is expected to grow from $515 billion in 2023 to $27.4 trillion in 2032, with an annual growth rate of 20.4%. At the same time, the GPU market is expected to reach $400 billion by 2032, with an annual growth rate of 25%.
It is predicted that AI + Crypto will unlock a huge market of $20 trillion. The decentralized computing power network, as a race closely tied to the concept of AI, is one of the most promising verticals in the cryptocurrency field to obtain real demand.


Meme narrative
Meme is gradually being accepted by the mainstream cryptocurrency market, and more and more people agree: consensus is value, and existence is rational.
Institutional investors’ investment allocation to meme coins has increased by over 300% this year, reaching a peak of nearly $300 million in April, with popular choices being DOGE, SHIB, and BONK.
Binance has launched several Meme coins, including PEPE, WIF, BOME, further providing sufficient liquidity for Meme, sparking enthusiasm among investors for Meme coins.
Symbols have tremendous cohesion, and Meme, as a universal language, enables the community to quickly reach consensus and form a simple and effective dissemination path. In addition, many celebrities have begun to get involved in Memecoin, enhancing Meme’s influence, similar to the previous cycle of celebrities buying and holding NFT collectibles.
Pump has issued over 1 million Meme coins, and its trading volume has reached $36 billion, with a growing number of new users. With the support of the issuance platform, Meme has become a very simple fund-raising mechanism and listing strategy.


It is expected that the Ethereum spot ETF will be approved and listed as soon as July 4, boosting market sentiment and the Ethereum ecosystem. The S-1 documents required for the Ethereum spot ETF review have been received by the SEC and are required to be modified and submitted by June 21 (this Friday).
Instead of waiting for the arrival of the bull market, it is better to now start positioning in some Ethereum ecosystem projects. Sun Ge has always been buying Ethereum, or has inside information about the ETF. Although Sun Ge is a bit of a “knife,” there is no doubt about his ability to make money. In the near future, you should pay more attention to the Ethereum ecosystem.
Currently, the big pie and Ethereum retail investors basically do not have good entry opportunities, so the focus is on positioning quality altcoins in the later stage, striving to achieve overall returns of no less than 10 times this year.