In a tumultuous overnight session, Bitcoin (BTC) experienced a rapid ascent to a new all-time high of $69,400, only to face an abrupt decline, plummeting to $59,200 within a few short hours. This drastic downturn triggered the liquidation of over $1 billion in leveraged long positions on Binance.
Analysts from QCP Capital observe that despite Bitcoin‘s swift drop, funding has returned to reasonable levels, with the market exhibiting resilience as the dip was met with aggressive buying, notably around the $60,000 support level. The funding rates have stabilized at approximately 30% annually on Binance, prompting QCP Capital analysts to anticipate the outperformance of the ETH/BTC pair. They highlight the growing interest in a spot Ethereum exchange-traded fund (ETF) as a contributing factor to this shift in focus.
Despite the unwinding of leverage, term futures are still commanding a substantial premium over spot prices. Analysts emphasize a surge in client activity targeting the sale of the spot-forward spread, particularly for contracts expiring between September and December this year. This trend allows investors to secure risk-free yields for the year.
As of the latest update, Ethereum lags significantly behind its all-time high compared to Bitcoin, presenting the potential for rapid value appreciation. While Bitcoin is only 4.3% away from its historical peak reached on March 5, Ethereum trails by over 20%, according to CoinGecko data.
In the evolving crypto landscape, major Wall Street players are intensifying efforts to introduce more spot crypto ETFs. Following the U.S. Securities and Exchange Commission’s (SEC) approval of all applications for spot Bitcoin ETFs in January, reports indicate ongoing discussions between the SEC and Ethereum ETF applicants. Decisions on spot Ethereum ETFs are expected to be delayed until May at the earliest. Key filings, including VanEck’s, await a response by May 23, alongside applications from industry giants such as BlackRock, Franklin Templeton Grayscale, and Invesco Galaxy.
