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- 🥜 Ethereum all time highs coming
🥜 Ethereum all time highs coming
PLUS: Potential Chop Ahead
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What we’ve cooked up for you today…
🔥 The Ethereum fee war heats up
🤑 Ethereum all-time high soon
🤔 Are we back?
💰 And more…
MARKET WATCH ⚖️
Prices as at 6:00am ET
Only the top 20 coins measured by market cap feature in this section
THE ETHEREUM FEE WAR HEATS UP 🔥
BREAKING: BlackRock sets 0.25% fee in latest round of amended forms as firms gear up to launch spot Ethereum ETFs
Two days ago we mentioned that Ethereum ETF applicants would submit their final S-1 forms this week.
Well today was that day.
The final S-1 forms are in and with them the fee structure for all applicants has been revealed.
Here’s what we know so far:
BlackRock: 0.25% base fee - 0.12% fee for first 12 months or up to initial $2.5 billion
Fidelity: 0.25% base fee - 0.00% fee up until 31st December 2024
21Shares: 0.21% base fee - 0.00% fee for the first 6 months
Bitwise: 0.20% base fee - 0.00% fee for the first 6 months or up to initial $500 million
Franklin Templeton: 0.19% base fee - 0.00% for the first 12 months or up until initial $10 billion
VanEck: 0.20% base fee - 0.00% fee for the first 12 months or up to initial $1.5 billion
Invesco Galaxy: 0.25% base fee - no initial fee waiver
Grayscale: 2.50% base fee - no initial fee waiver
Grayscale mini: 0.25% base fee - 0.00% fee for the first 12 months or up to initial $2 billion
Grayscale’s ETF will operate a little differently this time.
On launch, 10% ($1 billion) of the Grayscale Ethereum Trust (ETHE) will be converted into a mini ETF which has 10x lower fees.
Here’s the thing though…
This mini ETF has the same base fee as BlackRocks.
And we know from the Bitcoin ETFs, that investors are likely going to with BlackRock over Grayscale.
Especially when the products are the same and they have the same fees.
Many were expecting the Grayscale mini ETF to have the lowest fees of the lot.
But we guess that’s not the case.
Just like we experienced with Bitcoin, we may be in for some MAJOR Grayscale outflows once again.
ETF analyst James Seyffart posted the below summary table to Twitter.
According to analysts, next week is finally approval week.
July 23rd, mark it down in your calendars. 🗓️
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ETHEREUM ALL-TIME HIGH SOON 🤑
The launch of the Ethereum ETFs will push ETH’s price to new all-time highs above $5,000.
That’s the latest prediction out from Matt Hougan.
Matt Hougan is the Chief Investment Officer at Bitwise, the 5th largest Bitcoin ETF issuer.
Every week, Matt releases a market commentary memo.
This week Matt focused on why the Ethereum ETF flows will have a bigger impact on Ethereum.
“I think the new Ethereum ETPs will attract billions. And I think the money flowing into these new ETPs will have a bigger impact than it did with Bitcoin.”
1. Ethereum’s lower short-term inflation rate
When the Bitcoin ETFs launched, Bitcoin’s inflation rate was 1.7% (it’s now 0.85% due to the halving in April)
In other words, 328,500 additional Bitcoin were being produced every year or $16 billion at the prices back then. That means the market required $16 billion in buying each year just to break even.
But Ethereum is different…
Over the last year, Ethereum’s inflation rate has been ~0%
That’s because when people interact with the Ethereum network, they’re consuming ETH and permanently removing it from the supply.
“Significant new demand meets 0% new supply? I like that math. And if activity on Ethereum ticks up, so does the amount of ETH being consumed. That's another lever of organic demand working in investors' favor.”
2. Unlike BTC miners, ETH stakers don’t need to sell
A major difference between BTC and ETH is that BTC miners generally have to sell the new supply they mine.
Ethereum stakers do not.
Ethereum doesn’t rely on mining; instead it uses a proof-of-stake system.
Stakers commit ETH to the network in order to process transactions and earn ETH back as a reward.
“A key difference between Bitcoin mining and Ethereum staking is that staking does not have significant direct costs. As a result, Ethereum stakers are not forced to sell the ETH they produce.”
In the short-term, ETH has less forced selling each day compared to Bitcoin.
3. 28% of ETH is staked and therefore off market
Approximately 28% of the current Ethereum supply is staked.
Which means it’s effectively off the market.
On top of this ~12% of all ETH is locked in DeFi smart contracts.
Add them together and you’ve got ~40% of all ETH being unavailable for sale.
That’s massive.
So that’s three reasons why Matt believes that ETH will be more responsive to ETF inflows.
In short: ETH’s supply dynamics are tighter than Bitcoin’s
Matt also expects the Ethereum ETFs to bring in $15 billion in new assets over their first 18 months.
“If the ETPs are as successful as I expect—and given the dynamics above—it’s hard to imagine ETH not challenging its old record.”
A new Ethereum all-time high may just be around the corner. 👀
ARE WE BACK? 🤔
So Bitcoin’s been going through a bit of a recovery period lately…
And with prices having climbed from a low of ~$54,000 to ~$65,000 today.
That begs the question:
Are we really back?
To answer this we’ll be diving into some pricing models.
These models focus on the realized price of Bitcoin for two different cohorts: long-term holders (LTH) & short-term holders (STH).
Coins held for longer than 155 days are classified as LTH and coins held for less than 155 days are STH.
Basically we’ll taking a look at the average purchase price of LTH’s & STH’s. We’ll also be comparing these to the 200-day moving average.
Here’s the breakdown:
🟠 Realized Price: $30,900
🔵 LTH Realized Price: $19,900
🔴 STH Realized Price: $64,600
200D Moving average: $59,500
With the price of Bitcoin currently at ~$65,000 we are above all pricing models.
Which is a clear bullish sign. 🐂
But…
Notice how close the STH realized price is to the current price?
That’s an indication that there may be more choppiness ahead until we convincingly break past it. (as it stands, the average STH is only just in profit)
The main takeaway here is that the market is heading in the right direction once again.
Breaking through the 200 day moving average is an important sign as well as the STH realized price.
But until Bitcoin blows past the STH realized price, we aren’t out of the woods yet…
CRACKING CRYPTO 🥜
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Spot Bitcoin ETF inflows surge, but BTC struggles to rally above $65K. Inflows to the spot Bitcoin ETFs have surged, but changes in investor sentiment could contribute to slowing down the rally in BTC price.
Democrats Have Made a 'Horrific Mistake' on Crypto, Says SkyBridge Capital’s Anthony Scaramucci. The former White House Communications Director under President Trump spoke in an exclusive interview with CoinDesk’s Jennifer Sanasie.
Ethereum Creator Vitalik Buterin Rattles Industry After Warning of Pro-Crypto Candidates. Amid Trump’s increasing crypto embrace, Vitalik Buterin’s post drew a range of reactions—including one CEO calling him “politically naive.”
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DISCLAIMER: The content of this newsletter is not financial advice. This newsletter is strictly educational and is not investment advice. Please be careful and do your own research.
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