Anders Helseth and Vetle Lunde, researchers at K33 Research, wrote “Ahead of the curve” report which is an update about the crypto market, mainly focused on Bitcoin and Ethereum.
In an earlier CCN article, Helseth and Lunde explained the potential outcomes of ETF rejection/approval to the overall BTC market.
In their report, Helseth and Lunde foreshadow the market’s preparation for ETH ETFs.
“September and October favor overweight exposure in ETH, as ETH carries stronger ETF momentum in the short term. Futures-based ETH ETFs are scheduled to receive their final verdicts in mid-October. In 2021, futures-based BTC ETFs facilitated a 3-week rally of 60% in BTC, as activity thrived on CME ahead of the launch. ETH filings were also live back then but got recalled quickly due to the nascency of CME’s ETH futures.”
“This time is different; filings have yet to be recalled, and CME’s ETH futures have been live for 2.5 years. The odds are stacked in favor of ETH. Further, ETHBTC trades near 2.5-year range lows, with considerable wiggle room for relative upside.”
Lunde also states that “the market dramatically underestimates the impact of U.S. BTC ETFs and, in extension, futures-based ETH ETFs. In September, few catalysts await, offering a solid opportunity for strategic positioning ahead of an October packed with market-moving events. I favor a mix of increased ETH exposure and conservatively leveraged long exposure in BTC.”
The K33 report goes on to state “Over the past month, BTC’s 30-day correlation with ETH has climbed from 0.86 to 0.96 as Large Caps continue to move in tandem with bitcoin.
“This is reflected in the below chart, where BTC and Large Caps track each other nearly 1 to 1 over the past 30 days. Small caps and Mid Caps still underperform in an environment where the traders prioritize less risky exposure.”
For that reason, Anders seems optimistic about ETH investment in 2023. During a conversation with CCN, Anders mentioned two clear reasons why ETH should be in the crosshairs of all crypto investors.
“There are two main factors behind our prediction that ETH will perform better than BTC in the coming months.
Put the two together – and we believe now is a good time to increase Ether exposure. But it’s not a certainty of course,” said Anders