Ether (ETH) and native tokens of applications built on Ethereum surged in the past 24 hours as traders bet on the likelihood of the possible proposal of an ether exchange-traded fund (ETF) following the expected approval of a bitcoin ETF in the U.S.
Ether exchanged hands over $2,400 in early European hours Wednesday, up 5% in 24 hours. Bitcoin was down 2.2% in the same period as a series of fake tweets from the temporarily hacked U.S. Securities and Exchange Commission’s X account, which created significant volatility in bitcoin trading.
BlackRock had previously filed an S-1 form with the U.S. Securities and Exchange Commission (SEC) for its iShares Ethereum Trust, a spot ether exchange-traded fund (ETF).
Sentiment in the crypto community suggests traders are positioning themselves for an eventual ether-focused product – which could be the first time professional investors in the U.S. gain spot exposure to the blockchain’s token without having to own it.
“There’s a noticeable trend towards frontrunning the ether ETF,” Alex Onufriychuk, the CEO of Kaminari, said in a Telegram message.
Lido’s LDO and RocketPool’s RPL gained as much as 17% before retreating. Both protocols allow users to stake ether on their platforms and earn around 4.5% in annualized staking rewards.
Elsewhere, tokens of layer 2 networks such as Mantle’s MNT and Optimism’s OP gained as much as 9%. These networks are built atop Ethereum but operate as independent blockchains, allowing users to transact cheaply and much faster than the main blockchain.
However, market observers cautioned that an ether ETF remained a probability rather than a possibility as of Wednesday.
“The main idea is that ETH, being the second largest cryptocurrency, would have the highest probability of being the next ETF after BTC,” Martin Lee, analyst at on-chain data firm Nansen, told CoinDesk in a Telegram message.
Thirteen issuers, including traditional finance giants BlackRock and Fidelity, are currently in line for a spot bitcoin ETF whose approval is widely anticipated later on Wednesday.
