ETH Price Could Crash Despite Spot Ethereum ETFs Euphoria, Analyst Explains Why

With
the
Spot
Ethereum
ETFs
expected
to
begin
trading
on
Tuesday,
July
23,
expectations
for
the
ETH
price
have
shot
up
drastically.
Numerous
analysts
and
market
experts
have
come
forward
to
predict
that
it
would
be
a
great
development
for
the
ETH
price,
pushing
it
to
new
all-time
highs.
However,
one
analyst
has
warned
investors
to
exercise
caution
during
this
time
as
the
Spot
Ethereum
ETFs
going
live
may
not
have
the
expected
effect
immediately.

Why
The
Spot
Ethereum
ETFs
May
Lead
To
A
Decline

While
the
Spot
Ethereum
ETFs
going
live
for
trading
have
been
well-received
by
the
crypto
community,
crypto
expert
Benjamin
Cohen
has
pointed
out
another
alarming
development
that
could
send
the
ETH
price
crashing.
This
time,
it
is
the
ETH
supply
increasing
rapidly.

In
the
X
(formerly
Twitter)
post,
Cohen
points
out
that
the
ETH
supply
had
turned
inflationary
once
again.
For
reference,
the
Ethereum
Merge
previously
made
the
ETH
supply
deflationary,
with
burns
from
transactions
sending
hundreds
of
thousands
of
ETH
to
the
dead
wallet.

However,
recently,
with
activity
falling
to
new
lows
on
the
Ethereum
network,
the
supply
has
turned
inflationary
as
there
isn’t
enough
transaction
fees
being
burned
to
outpace
new
supply.
More
specifically,
the
crypto
expert
revealed
that
the
supply
had
gone
up
by
60,000
ETH
in
just
one
month.

Now,
if
the
supply
continues
to
increase
at
this
rate,
Cohen
explains
that
it
will
take
only
until
December
for
the
supply
to
get
back
to
where
it
was
before
the
Merge
was
completed.
Unless
there
is
a
reversal
and
the
supply
turns
deflationary
once
again,
this
new
supply
could
undermine
the
inflows
from
Spot
Ethereum
ETFs
and
push
the
ETH
price
down
instead.

Spot
ETH
ETFs
Trading
Draws
Closer

Last
week,
the
Chicago
Board
Options
Exchange
(CBOE)
announced
that
a
total
of
five
Spot
Ethereum
ETFs
will
go
live
for
trading
on
July
23,
2024.
These
funds
include
Fidelity
(FETH),
VanEck
(ETHV),
21Shares
(CETH),
Invesco
(QETH),
and
Franklin
Templeton
(EZET),
all
of
which
will
be
vying
for
the
top
spot.

So
far,
there
has
been
a
fee
battle,
with
each
fund
trying
to
outdo
the
other
with
lower
fees.
For
example,
the
Franklin
Templeton
fund
is
offering
a
low
fee
of
0.19%,
beating
out
Bitwise
and
VanEck’s
0.2%
and
coming
ahead
of
BlackRock,
Fidelity,
and
Invesco
Galaxy,
which
have
set
their
fund
fees
at
0.25%.

Like
many
others,
the
Bitwise
CIO
Matt
Hougan,
has
expressed
optimism
as
Spot
Ethereum
ETFs
are
set
to
begin
trading.
Hougan
predicts
that
these
funds
could
see
up
to
$15
billion
in
inflows
in
less
than
two
years
after
they
launched.

Featured
image
created
with
Dall.E,
chart
from
Tradingview.com