A number of analysts are counting on serious growth in Ethereum in the second half of the year. Optimism is primarily related to spot ETFs, which are expected to launch in July. If similar funds with Bitcoin raised $15 billion in investments in six months, then inflow estimates for Ethereum range from $5-10 billion.

In terms of capitalisation, altcoin is three times inferior to Bitcoin. This means that the expected inflow of investments will have a greater multiplier effect.

Furthermore, a reduction in circulating supply due to an increase in the volume of coins blocked in staking will also play a positive role. Currently, it amounts to 32.8 million ETH or 27.3% of the total issue.

Network deflation also has a long-term positive effect. Since the transition to PoS, the emission amounted to 1.4 million ETH, and 1.7 million ETH was burned. As network activity increases, this gap will widen as part of the transaction fee is burned.

MV Global predicts that the combination of all these factors will lead to Ethereum updating its price record this year.

However, the optimistic forecast lacks an estimate of the impact of the outflow from ETHE - the Grayscale fund, which holds 2.9 million ETH for $9 billion. The transformation of the trust fund into a spot fund will lead to the unlocking of assets, and some investors will rush to leave. A similar GBTC transformation led to a loss of over 50% of investments and an outflow of $18.7 billion.

The multiplier effect will be observed here as well, but in the opposite direction, since ETHE has a larger share in relation to the forecast inflow than GBTC in the inflow to Bitcoin-ETF. If history repeats itself, Ethereum will remain in the shadow of Bitcoin in terms of growth dynamics until the end of the year.

StormGain Analytical Group 
(platform for trading, exchanging and storing cryptocurrency)

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